Roku eclipsed Tesla as the top holding in the flagship ETF of Cathie Wood's Ark Invest on Thursday.
Ark has been a consistent seller of Tesla stock over the past year, reducing its position by 75%.
While Ark was selling Tesla, it used some of those proceeds to purchase Roku as it doubled its stake amid the ongoing tech sell-off.
The Ark Disruptive Innovation ETF owned $717 million of Roku as of Thursday's close, just barely higher than its $702 million stake in Tesla. The change in the ETF's top stock holding has been driven by both ongoing market volatility and Ark Invest consistently trimming its stake in Tesla and using those proceeds to buy Roku over the past year.
The Disruptive Innovation ETF has reduced its stake in Tesla by 75% from its peak over the past year. Over the same time period, ARK more than doubled its position in Roku. The move isn't entirely surprising given that Wood has consistently explained her strategy of concentrating the portfolio during periods of extreme market volatility.
And as it concentrated its portfolio, Ark Invest has consistently used its winning Tesla stake as a source of funds to add to some of its losing positions, including Roku. The ETF now owns 37 stocks, which is a decline from when it held 45 stocks last year.
Tesla has been Ark's only winning position over the past year, delivering a 25% return, according to data from Koyfin. Over that same time period, Roku stock has fallen 70%, and is down about 80% from its record high as investors race out of high growth tech stocks due to surging interest rates.
But Ark's selling of Tesla doesn't mean they are less bullish on the electric vehicle manufacturer. Just last month Ark updated its 2026 price target on Tesla to $4,600 as the research firm expects the company to develop and operate a network of autonomous ride-hailing cars. That represents potential upside of 546% from current levels.
And while Roku has overtaken Tesla as the top stock in Ark's flagship ETF, Tesla remains Ark Invest's top position across all of its ETFs, according to data from Cathie's Ark. Ark owns $907 million of Tesla across its 6 actively managed ETFs, while it owns $843 million of Roku.
Read the original article on Business Insider