Cathie Wood’s Ark Investment Management has reopened positions in Alibaba for the first time in four years, coinciding with the stock’s rally to a multiyear high. The renewed interest comes amid growing optimism surrounding the Chinese firm’s advancements in artificial intelligence. A recent trading report from Ark revealed that two of its exchange-traded funds (ETFs) acquired American Depositary Receipts (ADRs) of Alibaba on Monday (Tuesday AEST). The total value of these stakes is approximately $US16.3 million ($24.7 million), according to the funds’ holdings reports. Ark Investment Management is an investment firm known for its focus on disruptive innovation and technology sectors. They manage several exchange-traded funds (ETFs) that invest in companies believed to have high growth potential.
Alibaba’s ADRs reached their highest levels since November 2021 on Tuesday, nearly doubling in value year-to-date. This surge reflects investor confidence that Alibaba’s push into AI could revitalise growth, particularly as its core e-commerce business faces increasing competition from rivals such as PDD Holdings. Ark’s initial investments in Alibaba date back to 2014, shortly after the company’s IPO. However, no investment or proxy voting activity was recorded after September 2021, during a period of significant regulatory scrutiny for the sector.
This latest investment could signify a strategic return for Ark, which had previously reduced its holdings in Chinese internet stocks following the market downturn in 2021 and 2022. Earlier this year, Ark began establishing a position in Baidu, according to SEC filings. The firm further increased its stake in the search engine operator on Monday, bringing the total position to approximately $47 million. In addition to Alibaba and Baidu, Ark’s ETFs also hold investments in companies like electric vehicle maker BYD, autonomous driving technology firm Pony AI, and JD Logistics, although these positions are comparatively smaller.
Cathie Wood is renowned for her aggressive investment strategies in disruptive technologies. Her flagship Ark Innovation fund (ARKK) achieved substantial gains in 2020. While the fund’s 49 per cent return this year surpasses both the S&P 500 and the Nasdaq 100, it remains down on a five-year basis and has experienced an outflow of $438 million this year, according to Bloomberg data.
