Cathie Wood’s ARK Invest Funds Are Buying Penny Stocks But Are They Worth It?
By simple definition, penny stocks are shares of stock trading for less than $5. Some may define them by exchange, while others place a lower price threshold on these cheap stocks. Needless to say, if you do a quick search on the ol’ Google machine, you’ll find that most outlets report this $5 mark as the threshold.
Regardless of how you feel about low-priced stocks, or what you call them, for that matter, the idea of buying cheap stocks is relatively universal for most traders. You either avoid them altogether or try your hand to make money with them by investing or trading.
One of the barrier-breaking names in the stock market today is Cathie Wood. She has become a rockstar among retail traders. Whether it’s finding ways to double down on certain meme stocks or taking an aggressive stance on higher-risk niches, her style of investing has gained broad support from mom and pop traders over the last year. Her claim to fame came during the pandemic of 2020 when her innovation ETFs gained billions of inflows and capitalized on numerous trends that emerged.
Cathie Wood’s “Ark On Steroids” Approach
In an interview this week with CNBC, Wood seemingly upped the ante on her bullish market outlook. She explained that her firm is “testing out a portfolio, but it’s really Ark on steroids.”
“We think the benchmarks are where the big risks are long term, because they are filling up with value traps — those companies that have done very well historically but are going to be disintermediated and disrupted by the massive amount of innovation that’s taking place.”
Though this methodology could be more volatile, according to Wood, she expects that in 5 years, the world “will look nothing like it does today, and we’re invested in all the disruptors, the winners, that are going to disrupt the traditional world order.”
ARK Invest Penny Stocks To Watch
Thanks to our namesake, we focus much more on cheap stocks rather than your bigger blue chips. Call them penny stocks, call them low-priced equities, or call them the cat’s pajamas; this comes secondary to the whole purpose of putting together a list of inexpensive stocks for your watch list. Keeping to this theme, we took a look at some of ARK’s family of funds to see if Cathie Wood has a soft spot for low-priced names.
Believe it or not, there were a few current and former “penny stocks” that we’ve reported on and are currently sitting among the holdings of some of these funds. Here are 5 to watch heading into the end of the year.
Nano Dimension (NASDAQ:NNDM)
Shares of Nano Dimension are no stranger to big breakout moves. In fact, at one point last year, NNDM stock was trading below $1. The initial spark that ignited some early…