Originally published on: October 09, 2024
In a recent move, ARK Invest, led by the well-known Bitcoin advocate Cathie Wood, has sold a significant portion of its Robinhood (HOOD) holdings. This decision came as ARK offloaded 1.4 million Robinhood shares, totaling $36.4 million across its three funds.
The sale was driven by ARK’s need to maintain compliance with Rule 12d3-1, which limits funds from acquiring over 5% of an issuer’s securities in relation to their total assets. As Robinhood’s stock price has soared by over 100% year-to-date, ARK’s divestment signals a strategic shift.
Despite the stock’s recent performance, Robinhood closed at $25.61 on October 8, marking its highest value since November 2021. The company has seen a 30% increase over the past month but remains below its all-time high of approximately $44 achieved after its public debut.
ARK’s sale included three main funds: the ARK Innovation ETF (ARKK), the ARK Next Generation Internet ETF (ARKW), and the ARK Fintech Innovation ETF (ARKF). ARKK accounted for the largest portion of the sale, with ARKW and ARKF also parting ways with their Robinhood shares.
Although ARKK retained around $274 million of Robinhood stock as of October 9, constituting about 4.9% of its total assets, the fund has diversified its holdings in companies like Coinbase. With assets totaling $368 million, Coinbase ranks as the third-largest asset in ARKK’s portfolio, following Tesla and Roku.
This move sheds light on ARK’s strategy amid evolving market conditions and regulatory requirements. As the financial landscape continues to shift, staying agile and making calculated investment decisions remains key. Subscribe to our Markets Outlook newsletter for critical insights on investment opportunities and trading strategies to navigate the dynamic market landscape.
