Summary
- ARK Invest sold over 85,000 Tesla shares across two ETFs
- The reason for selling was to prevent overconcentration in the ETFs, not to make a profit
- Sales totaled over $22.2 million in value and were used to purchase other stocks
- ARK’s thesis for Tesla values the stock at $2,600 per share in 2029
- ARK buys Tesla shares when the stock is down and sells when it begins to dominate ETFs, not for profitability.
Article
Ark Invest, led by Cathie Wood, is known for being one of Tesla’s biggest bulls. The firm recently sold over 85,000 shares of Tesla across two of its ETFs. This move was not made to take a profit, but rather to prevent overconcentration of Tesla shares in the ETFs. After Tesla experienced its biggest day in a decade on Wall Street, Ark Invest decided to sell a portion of its Tesla holdings to balance out the funds.
In the ARKK ETF, Ark Invest sold 77,513 Tesla shares, which equates to 0.363 percent of its holdings. In the ARKQ ETF, 7,943 shares were sold, representing 0.2592 percent of the holdings. This resulted in over $22.2 million in value that was used to purchase other stocks. While Ark Invest is known for being bullish on Tesla, some were confused by the move. However, the firm clarified that the decision was made to prevent overconcentration of Tesla shares in the ETFs.
Ark Invest has a long-term thesis for Tesla, which includes a projection of $2,600 per share by 2029. This projection includes a bear case of $1,500 and a bull case of $7,000. The firm does not sell Tesla shares for profit-taking purposes, as it believes in the long-term potential of the stock. However, it periodically sells shares to prevent the ETFs from being overly concentrated in Tesla. Conversely, when Tesla stock is down, Ark Invest tends to buy more shares to increase its position in the company.
Despite the recent sale of Tesla shares, Ark Invest remains bullish on the stock. The firm believes in Tesla’s potential for growth and innovation, and continues to hold a significant stake in the company. After a strong performance by Tesla on Wall Street, Ark Invest made the decision to sell a portion of its holdings to maintain a balanced portfolio. As Tesla’s stock price continues to fluctuate, Ark Invest actively manages its positions to ensure that the ETFs are not overly concentrated in any one stock.
Overall, Ark Invest’s decision to sell Tesla shares was not based on profit-taking, but rather on maintaining a diversified portfolio. The firm continues to believe in Tesla’s long-term growth prospects and remains committed to its investment in the company. As Tesla’s stock price fluctuates, Ark Invest will continue to adjust its holdings in order to achieve a balanced and diversified portfolio for its ETFs.
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