AI Stocks in Cathie Wood's Portfolio: From Titans to Up-and-comers

JJohn August 12, 2023 2:08 PM

Ark Invest CEO Cathie Wood is known for investing in innovation, with a significant focus on artificial intelligence (AI). This article explores the AI stocks in her portfolio, ranging from top-tier titans to emerging players.

Top-tier titans in AI

Wood's top five AI investments are what one might call the 'titans' of the field. With the likes of Alphabet, Amazon, Microsoft, Meta Platforms (formerly Facebook), and Tesla, these stocks represent leaders in the AI domain. Alphabet leads the pack, thanks to its AI-focused Google DeepMind unit, its various AI-driven growth paths including Waymo self-driving cars and Google Cloud, and its attractive valuation. The rest of the pack also have robust prospects, with Amazon and Microsoft expected to benefit tremendously from AI advances. Meta's open-source approach to AI and Tesla's potential in self-driving robotaxis also make them promising investments.

AI stocks with asterisks

The next five AI stocks in Wood's portfolio offer impressive growth prospects, but come with certain caveats. Nvidia's stock has soared, driven by AI demand for its graphics processing units, but its high valuation could signal a potential pullback. Palantir and AMD face similar issues. Additionally, both Taiwan Semi and come with risks associated with potential Chinese government interference and geopolitical uncertainties, despite their significant stake in AI.

The last four AI stocks in Wood's portfolio are what one might call 'up-and-comers.' Teradyne, Accolade, Schrodinger, and Recursion Pharmaceuticals are making a name for themselves in the AI field, albeit with more risk than their more established counterparts. Teradyne's technology is used in testing autonomous mobile robots and is already profitable. Accolade is using AI to develop personalized healthcare solutions, while Schrodinger and Recursion are utilizing AI for drug discovery and development.

Tesla's prominence in Wood's portfolio

Despite being fifth on the list of top-tier AI titans, Tesla is the cherry on top for Wood. The electric vehicle manufacturer is the top position in her combined Ark Invest portfolio and makes up more than 7.6% of the ETFs' total holdings. While it is argued that Wood could have invested more heavily in some of the other stocks, there's no denying the impressive lineup of AI stocks in her Ark Invest holdings.

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