This article first appeared on GuruFocus.
Cathie Wood just doubled down on the AI kingand the timing could be the real story. ARK Innovation ETF (ARKK) stepped back into Nvidia (NASDAQ:NVDA) on Thursday, snapping up 93,374 shares right after the company delivered earnings that topped expectations and hinted at an AI demand cycle that may still have room to run. It was ARK’s first Nvidia buy since Aug. 4, adding to the more than 1.1 million shares the firm already held as of Sept. 30. But the market didn’t celebrate for long. Nvidia’s early surgeup more than 5%quickly faded as investors started reassessing the odds of a possible December rate cut, leaving the stock down 3.2% at $180.64 by the close.
That hesitation rippled far beyond New York. Asian AI stocks mirrored the mood, with major benchmarks in South Korea and Taiwan sliding more than 3% on Friday. Even as Nvidia’s leadership pushed back on the idea of an AI bubble, traders seemed eager to reduce risk rather than chase it, especially with rate expectations moving against them. What looked like a victory lap for the world’s most valuable company turned into a reminder that sentiment around high-growth AI names could be fragile in the short term.
For ARK, the trade lands at a sensitive moment. Its flagship ETF is now more than 20% below its October peak, compared with a 4.3% pullback in the Nasdaq 100 over the same stretch. And because ARK’s daily disclosures capture only active buy-and-sell decisionsnot investor inflows or redemptionsthe Nvidia purchase signals a deliberate move rather than mechanical flows. It could be a bet that Nvidia’s sharp reversal has opened up a window for upside, even as volatility remains the dominant force shaping how investors approach the AI trade heading into year-end.