Cathie Wood’s ARK Sells GitLab Shares, Adds ARK 21Shares Bitcoin ETF
Key Takeaways
- ARK sold 208,528 shares of GitLab Inc. valued at $8,459,980 and purchased a total of 70,125 shares of ARK 21Shares Bitcoin ETF.
- With its purchase of the ARK 21Shares Bitcoin ETF, ARK is increasing its portfolio exposure to the largest cryptocurrency in the market.
- While there are risks, the growth potential that ARK will experience with its investment in Bitcoin ETFs is high.
Cathie Wood’s ARK’s sale on Friday saw significant shifts in its portfolio. It sold 208,528 shares of GitLab Inc valued at $8,459,980. The sale is an extension of ARK’s strategic reduction of its hold on GitLab shares. Earlier on November 21, ARK had sold 670,144 GitLab shares valued at around $28.5 million, alongside a purchase of 20,700 shares in the ARK 21Shares Bitcoin ETF worth $123,000.
On the other hand, ARK purchased a total of 70,125 shares of ARK 21Shares Bitcoin ETF through its ARKW and ARKF ETFs, with a combined dollar value of $424,886. ARK’s strategic shift to Bitcoin ETFs shows its optimism about the prevalence of a bullish outlook for the overall crypto market in the near future.
Other Significant Trades
ARK has also made other significant trades and transfers in its portfolio. It sold 89,446 shares of Iridium Communications Inc., valued at $1,470,492, across its ARKK, ARKQ, and ARKX ETFs, thereby further reducing its stake in Iridium shares. Moreover, ARK also sold 22,281 shares of Ibotta Inc for $522,935 and 918 shares of Exact Sciences Corp for $93,131. On the other hand, ARK bought 6,363 shares of Kodiak AI Inc., valued at $38,814, through its ARKQ ETF.
How will ARK’s Bitcoin ETF Purchases Affect its Portfolio Risk?
With its purchase of the ARK 21Shares Bitcoin ETF, ARK is increasing its portfolio exposure to the largest cryptocurrency in the market. Since Bitcoin is an inherently risky asset with high volatility, ARK’s investments in Bitcoin ETFs will increase its risk exposure. However, holding Bitcoin as an ETF rather than directly holding the token will help ARK balance the risk due to the possibility of high liquidity.
By holding the ARK 21Shares Bitcoin ETF, ARK gets direct exposure to Bitcoin’s price changes. When Bitcoin’s price rises, the ETF’s value will increase proportionally, and vice versa. This can give short-term volatility risks to ARK’s portfolio. While the chances of security risks are negligible, regulatory uncertainties and technological risks remain.
On the other hand, the growth potential that ARK will experience with its investment in Bitcoin ETFs is high. If ARK is able to balance the increased risks from volatility and regulatory uncertainties, it will likely gain from the Bitcoin ETF.
The Bottom Line
ARK’s purchase of the ARK 21Shares Bitcoin ETF is a strategic step at the right time, given Bitcoin’s likely bullish outlook in the long run, driven by scarcity, institutional adoption, and its role as an inflation hedge. This portfolio shift will also aid ARK’s focus on disruptive innovation in crypto and AI. This calculated risk-taking behavior will definitely benefit ARK to grow.
Crypto & Blockchain Expert