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The female version of Warren Buffett and her ARK Shenzhou

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All Wall Street is talking about her!

Original title: "Wall Street "The Most Dangerous Woman", Sister Mumu and her ARK Shenzhou"

Original source: Trading Gate

< p>Sister Wood's team recruits analysts from all corners of the country and with different backgrounds, including cancer scientists, artificial intelligence experts, game engineers, and even captains. And ARK's marketing ideas are also very special. They provide free subscription services to retail investors, and send emails to subscribers every day to share ideas, disclose positions and transactions, which can be described as extremely transparent.

In August 2018, when Tesla’s stock price was hovering around 320 yuan, Sister Wood sent an open letter to Elon Musk, pointing out that Tesla Tesla, who forecast between $700 and $4,000 within five years, opposed Musk's proposal to take the company private. Musk and the board adjusted their decision after reading her letter.

From 2014 to 2016, ARK’s performance was sluggish, and it ranked at the end of similar funds. Sister Wood had to invest in savings and sell stocks to maintain operations. But starting in 2017, as the company's stock prices rose, Sister Mumu finally ushered in a good day.

All Wall Street is talking about her!

Catherine Wood, a Wall Street star fund manager known as the female Buffett (referred to as "Sister Wood" in this article), has become very popular recently. The active ETF fund she manages, ARK Innovation ETF (ARKK), rose 170% last year, and the management scale increased by 10 times, and several other ETFs also performed well.

Ms. Wood's hot performance has attracted the reports of major media. She is also known as Warren Buffett's Latest Challenger. Sister Mumu also became the goddess in the hearts of American retail investors. A friend who was doing business in the United States told me that even his friends who had never invested in him came to him to inquire about Sister Mumu.

Actually Sister Mumu is a Wall Street veteran with 40 years of professional investment experience. Before joining ARK, Sister Mumu worked in several organizations. Her previous employer was the well-known AllianceBernstein (Alliance Bernstein). She worked there for 12 years and managed $5 billion in assets.

Obviously, Sister Wood is not content to be bound by the organization (for this reason we will talk about it later). She came out to start a business, established ARK, and recruited analysts from all over the world. She never recruits finance majors or MBAs, and her team includes cancer scientists, artificial intelligence experts, game engineers, and even captains. In terms of external communication, ARK is also very different. They provide free subscription services to retail investors, and share and disclose the company's holdings and investment ideas every day, which is extremely transparent.

Sister Mumu’s ARK fund has concentrated betting on popular stocks such as Tesla, Roku, Square and biotech driven by the Covid-19 epidemic in the past few years. She told the media last month that she has ambitions to triple investors' money in the next five years.

"Many managers focus on how to beat the index? We think this is not seeking to make progress." Sister Wood said domineeringly. She believes that traditional large-scale funds have backward analytical thinking on technology stocks, and it is difficult to keep pace with the ever-changing era, so this is the primary reason for her establishment of ARK.

Ms. Wood believes that the team's accurate judgment of the world situation in five to ten years will make the company outstanding. The fund looks for companies that would benefit most from this transformation, based on a research strategy of "innovative platforms" such as robotics, DNA sequencing, energy storage, blockchain technology and artificial intelligence.

Sister Wood's ARK invested in Tesla about 5 years ago. This has been the fund's largest holding for the past 3 years. In the past 12 months, Tesla's stock price has soared nearly 10 times. Traditional analysts think that Tesla is a car company, and Ms. Mu believes that this view is very wrong. She believes that Tesla is actually a robotics company; an energy storage company because of its emphasis on battery technology; and an artificial intelligence company because of the development of driverless cars.

From 2016 to 2018, when the market questioned Tesla, she continued to increase her holdings of Tesla stock. In August 2018, when Tesla’s stock price was hovering around 320 yuan, Sister Mumu sent an open letter to Elon Musk, pointing out that Tesla’s internal forecast for five years was between 700 and 4,000 US dollars, and opposed Musk’s SK privatization proposal. Musk and the board adjusted their decision after reading her letter. In mid-January 2020, Sister Mu raised Tesla's target price to $6,000. At the end of January 2020, ARK Invest published an article stating that the target price of Tesla stock was $7,000.

Ms. Wood, who is good at using social media, has 280,000 Twitter followers focus on. She communicated and interacted with the public on Twitter, and announced her investment ideas with the team. Including the following Big Ideas 2020, and five subdivided PPTs. This is the consistent style of its team: the research is extremely transparent, not afraid that you will learn it, but afraid that you will not learn it.

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Then the question is, will the miraculous woman known as the female version of Warren Buffett (Warren Buffett) be short-lived?

The "Wall Street Journal" recently published an article stating that in the long run, there is a high probability that Sister Wood will end up with mediocre performance. Because the star fund managers who have been dazzling in history, in the long run, their performance tends to revert to the mean, and many of them are even worse than the average.

For example, the star fund manager Bill Miller (Bill Miller) once beat the S & P 500 index from 1991 to 2005 and attracted In the following years, he became one of the worst-performing fund managers in the United States.

Another once-booming mutual fund company was Janus. Between the end of 1998 and March 2000, it grew from the 20th largest mutual fund company in the United States to the fifth largest company in the United States, when it was a big hit with high-tech companies like Cisco Systems and AOL. The company is heavily loaded. Some of its fund products lost two-thirds or more of their net worth as the bubble burst.

S&P Dow Jones Indices (S&P Dow Jones Indices) once conducted research on the persistence of US fund performance. The result is very heartbreaking. In 2015, only 0.18% of the US stock funds ranked in the top 1/4 of performance in 2019 remained in the top 1/4, and did not fall to the back. And most actively managed funds have lagged the performance of the benchmark index after fees and taxes.

There are also countless studies that prove that star funds can quickly raise money after they become popular and get attention, but their performance after financing is not outstanding. Some fund managers also blame the money coming in too much and too fast, which makes management difficult. That's why ETFs have seen phenomenal growth in recent years, as large numbers of investors have pulled out of actively managed funds after disappointment.

Of course, most of the ETFs are passive ETFs that track the index. Allocation, so the rate is very low compared with active funds. However, Sister Mumu’s ETF fund adopts an active management style. In this type of ETF, fund managers can deviate from the positions of the benchmark index according to their own strategies. Since fund managers need to pay more labor, the management fees of active ETFs are generally higher than those of passive ETFs.

Bloomberg data shows that in 2020, there will be 68 actively managed ETF funds listed in the United States, while only 63 passive ETFs. This is the first time in the U.S. that active ETFs have had more initial offerings than passive ETFs.

However, active ETFs do not necessarily outperform passive ETFs. According to Morningstar data, in the past decade, the annualized excess returns of active ETFs have mostly been below zero. In other words, Sister Mu Mu’s ARK is still an absolute alternative (Outlier) among active ETFs.

What do the people around Sister Mumu think? What about hers? Trading Gate interviewed several Wall Street fund managers who had worked with Sister Mu Mu. They expressed their recognition of Ms. Mu's research ability, and one of Ms. Mu's former colleagues also exposed some of Ms. Mu's previous materials.

So, is it better to concentrate holding shares than to spread income?

A group member of the elite trading group shared with me: "Centralization and decentralization are just forms. Everyone is going to disperse and buy index funds. Digging for information carefully, Opportunities come for those who insist on doing the right thing and dare to stick to it for a long time. In the heavy siege of quantitative funds and index funds, the capital market linked to the real economy still needs someone to work hard between fundamentals and market prices. Those who discover value will be rewarded generously by the market.”

What do you think of Sister Wood and her excellent record ? Welcome to tell us in the comment area.

How can I subscribe to Sister Wood's letters for free? It’s actually very simple, just go to the ARK official website https://ark-invest.com/, click subscribe at the top of the page, fill in your information and areas of interest, and you’re done! After I subscribed, I immediately received the first letter from Sister Mumu!