ARK's Cathie Wood on Tesla, Twitter and China Stocks - YouTube

I gotta say I think a lot of us were a little surprised by Elon Musk and his investment in Twitter that passive investment nine

point two percent. You are a big investor in Tesla have been for a long time. I think about two and a half percent of your funds

are in Twitter as well. Was this a smart move by Elon. Well I do think for the moment it's passive but he is certainly

making a statement and it's a statement about censorship. He doesn't agree with censorship

for a smooth functioning democracy as he has tweeted I believe. And so I think he's sending a strong signal to the new CEO. And

I also know there's some controversy about why Jack left having to do with this new CEO. So few messages there. Have you talked

to Elon at all about it. No I have not. OK. And would you be buying either more Tesla or Twitter on the news. And let's throw

on Tesla also having this record first quarter. Is this a catalyst to buy more these shares in your view

on Tesla. We post are trades at the end of every day. So many will know that we have. It is the largest position in our

flagship portfolio and in most portfolios where we hold it. But we have been selling recently because of how well it has done

relative to the rest of the stocks in our portfolio. So it has levitated relative and and so it's been a good source of cash.

We've taken profits and redeployed them into other stocks that we thought were being unfairly penalized here. And I think one

of the reasons for that is Tesla's in the indexes the broad base loses and most of our other stocks are not. And that's a big

problem out there in terms of the way capital is being allocated these days in the public equity markets. JAFFE How much would

Tesla have to fall for you to start buying again. Well you know even now we're going to put out another model on

get hub in. I'm going to say within a week. Our last one is from about a year ago. And you'll see from that model that our price

expectation at that time was three thousand dollars. So there's still a lot of running room ahead for Tesla. But relative to the

other names in our portfolio even though that's a you know a trip or nearly a travel other names in our portfolio we believe

we'll deliver much more than that over the next five years because they have been hit so hard. They're not in indexes. And

so when there are risk off periods traditional investors really diversify and sell our stocks as they move closer to their

benchmarks the benchmarks against which they are measured. So it's a great buying opportunity for us. I will say I can't

believe how long that buying opportunity lasted from February of a year ago to a few weeks ago. But we think the concentration of

our portfolios towards our highest conviction names will pay off. As for Twitter. Well it's having a beautiful day to day.

And I think there are some investors relieved that someone is willing to speak up and say hey you're going to ruin this

platform if continue to censor it. In somewhat

random ways. So. So I think that's good. I will say this could be setting up for another leadership change at Twitter. You

never know. And so that will bring with it perhaps some uncertainty uncertainty and dislocation. So especially as it

relates to advertisers. So. So we shall see. So Kathy uncertainty potentially at Twitter a potential leadership

change. Who are the names that you would like to see lead Twitter. Who could do a great job in your opinion. Oh I am not

going to speculate on that. You know and to be honest we haven't thought about it that carefully. There are names flying around

but I wouldn't want to throw out anything there unless unless we felt very strongly. So we will wait to see whose names are put

forth. But whoever is put forth and I'm not jumping to this conclusion automatically I'm saying is one of many

possibilities. It'll either be Agarwal changing the policy of the company to you know really open source the way the

censorship or call people out on censorship or it will be a management change. I don't know what's going to happen at all.

You use the platform a lot. Kathy you own the platform. What are the specific changes that you would like to see perhaps Elon

Musk if he would be vocal about it push for that Twitter. Well I think I think he's already pushing for it. He's been

pretty vocal talking about censorship not being good for the platform which is you know really the world's platform sort of

engagement platform. And yes we do use it liberally. We have not been banished yet. But you never know. You never know. Well I'm

curious to death you know in terms of Elon Musk Kathy you know looking at Twitter making this investment does it make you want

to look at some of the other social opinion platforms that are out there and social media platforms whether it's Metta which

has certainly been beaten up big time. Does it make you want to kind of look at them as effort to further investments or initial

investments. Not really. I think what's happening on the ground is shifting underneath social media. I don't think anyone

understood until Facebook reported or gave guidance for the first quarter how provocatively disruptive ticktock had become.

I mean I know I've seen my children and and their generation spend a lot more time on tech talking and wondered you know how

how would this impact Facebook. But I also know that there's a huge advertising shift from linear TV to social. So you had

those two opposing forces. Well it appears that tick tock is being much more disruptive than we thought. And not just

Facebook but Netflix has talked about it as well. This is competition for the consumers time. And so I think again the

ground is shifting. And if you think about it a Facebook Facebook when you think about Instagram and Facebook itself it's

all about me me me. It's you know high and central. If you think about tick tock it's about how can I entertain you. It's a

completely different DNA. So I'm not so sure that the reals is is going to make it the way that stories. Stories was about me

me me. Facebook got that. Tick Tock is a completely different animal here. Hey Cat got to ask you about Chinese stocks. You

and I have certainly had conversations and you've made investments and you've gotten out. You've got. And I just want

to know where you are in Chinese stocks right now because we've seen quite a bounce back in the last couple of days still down a

lot. If I look at something like the NASDAQ Golden Dragon would you

be committing new money. Do you have faith in Chinese authorities actually making Chinese

companies much more transparent for U.S. investors especially when it comes to financially sensitive information. Well I think

that the government is showing that at the margin it's going to make moves but they're going to be marginal moves in this case.

I think there are three years to comply with our audit requirements.

So they're talking that they're there they're talking. And so we'll see what happens. You know common prosperity to us means

that profit margins are high. Profit margins are not a good thing.

And so we have steered away from anything with a high profit margin.

And we have focused on those companies. And we in our flagship strategy were out completely. We've shifted toward something

like C Limited in Singapore but in a more specialized strategies we're looking for very low margin companies that are consistent

with common prosperity. You know really distributing goods and services into lower tier cities for example or providing

transportation. So expand neo we have but they're very low margin.

It's all about next gen transportation in a world where you know human driven cars are are still relative to the eligible drivers

still very low percentage. So we're interested there. JD Logistics in the logistics area using drones but lots of

innovation. They're doing a lot again pushing into the lower tier cities. So we're a bit gun shy. We don't think that the

Chinese government is thinking very much about creating capital. Well but we know there are huge opportunities consistent with

common prosperity. And so we will have an allocation. But until things change

dramatically meaning more of friendly to capital will probably keep that exposure pretty low. Hey Kathy one thing I mean you

and your team are very good about research right. And you open it up to the world and you want to have these conversations. I

am curious when we look at the world specifically what's going on in Ukraine and Russia China's relationship specifically with

it seems like wanting to continue some kind of relationship with Russia.

How is that problematic do you think for investors going forward and ultimately Chinese companies. And is there kind of a rethink

on what our global markets ultimately will be like. Longer term you are a longer term think individual.

Yes. Yes. Well one thing I do know about China is it's a survivor.

And it really does want to be if it really wants to be in the lead in terms of innovation. So we given our sole focus on

disruptive innovation are not going to dismiss China but these geopolitical strains are not going to be good again. Capital

unfriendly. We do know that innovation solves problems.

And starting with Covid where we had a lot of problems now with the Ukraine Russia the Russian invasion of Ukraine we have a lot

more problems. And so we think innovation generally is going to help solve

those problems. And so we're happy that the market is now turning its sights back to innovation being a good thing and not

index stocks being an area of great opportunity.