Cathie Wood-led Ark Invest has in the recent past been cutting exposure in the Chinese tech stocks but the popular money manager is not shutting the door on them yet.
What Happened: Wood on Tuesday said she is keeping an "open mind" on Chinese stocks as she believes there are still some very interesting companies in the innovation space, Bloomberg reported, citing the popular asset manager.
The New York-based Ark Invest has been significantly cutting her stake in companies such as $JD.com Inc(JD.US)$, $Pinduoduo(PDD.US)$ — two stocks that the investment management firm was betting heavily on just months ago. Wood’s firm has also trimmed stakes in $TENCENT HLD ADR(TCEHY.US)$ and $Alibaba Group Holding Ltd(BABA.US)$.
“Well, I would say in any of the areas that we’re looking at right now, the multiple structure, the valuation structure of those companies is down and probably not going to come back very quickly, may even go down more,” Wood told investors during a webinar.
“I’m sure we’re going to find some very interesting companies in the innovation space, and so we’re going to keep an open mind there.”
Why It Matters: Ark Invest’s largest fund, the $ARK Innovation ETF(ARKK.US)$, lowered its exposure in Chinese companies to less that 0.18% in August of its $23 billion in assets from 8% in February, Bloomberg noted.
U.S. listed Chinese stocks such as Alibaba, Tencent, JD.com, and $NIO Inc.(NIO.US)$ have over the last several days plunged.
Experts believe the recent sell-off provides a good entry point for long-term investors.
Source: Ark Invest