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ARKK Innovation ETF sees sharp losses amid tech sell-off

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Yahoo Finance's Alexandra Semenova joins the Live show to discuss the ARKK Innovation ETF as the fund sees sharp losses amid tech sell-off.

Video Transcript

- Cathie Wood's Ark Innovation ETF is facing more setbacks, falling-- and this is over the past two days you're seeing it. Net lower it looks like by about 7.8% as the tech sell escalates. Joining us now to share the details, we've got Yahoo Finance's Alexandra Semenova. Alexandra?

ALEXANDRA SEMENOVA: Well, Brad, it seems like there is no end in sight for the downturn in Cathie Wood's flagship Ark Innovation Fund. The ETF was front and center for the sell off that we've been seeing in equity markets these past few trading sessions. The tech focused fund plunged 10% in yesterday's session alone, deepening the already sharp losses that it's seen this year that began in late 2021.

The loss brings Ark down around 75% from its peak in February of last year, with all of its biggest components trading in the red year to date. This comes, of course, during a broader route in technology stocks that has been hitting the speculative innovation-focused assets that comprise Ark's holdings quite hard. But worth noting that arc is really bearing the brunt of this sell off fairing much worse than some other equity funds. The ETF has been on a long way down from its run in 2020 and is now poised to give up the hefty pandemic gains that made Cathie Wood a star stock picker. Guys?

- Well, Alexandra, it's interesting. We also learned about a new investment that Cathie Wood made for that Ark Innovation Fund, and investors might be surprised unless they had heard my interview with her last month. We're talking about her investment in General Motors. Here's what she had to say about the company at the time.

CATHIE WOOD: I joined our analysts and went out to GM to meet with a full day of meetings with Mary Barra and her extended team. We have one more meeting with [? Cruz, ?] which is, of course, in San Francisco. But I'm fascinated by how Mary Barra is really turning that ship around and very, very focused on [? Cruz ?] Automation and leaving it alone now Kyle the founder is back as leader and watching them make San Francisco autonomous work.

- And so, Alex, she's obviously now acted on her admiration for the company.

ALEXANDRA SEMENOVA: Yeah, Julie. Interesting reversal here for Cathie Wood with ARK Investment making its first ever investment in a legacy automaker after she's been a vocal critic of these traditional car makers. Ark bought up about 158,000 shares of General Motors for its Ark Autonomous Technology and Robotics ETF. That's ticker ARKQ.

And this move comes, of course, after she told you exclusively in your interview last month, as we saw in that clip right there, that her team met with Mary Barra to learn more about its electric vehicle efforts. You know, this is a big change of tune for her. Just a few months ago, she said that GM could possibly go bankrupt because it wasn't making enough of an effort to move into electric vehicles.

She's been a heavy critic of companies like General Motors and Ford. Also interesting because Cathie Wood is a big Tesla bull, as we know. So it'll be interesting to see, as other makers step into the electric vehicle space, how that will change her position on Tesla and whether she'll foray into any other makers. Guys?

- All right, Alexandra Semenova. Thanks for breaking down all things in the world of Ark. Appreciate it.