Financial Associated Press (Shanghai, editor Bian Chun) news, in the early year of the technology stock plunge, ARK Invest (ARK Invest), known as the "goddess of technology stocks" Cathy Wood (Cathy Wood) fund performance dismal. According to financial analysis firm S3 Partners, traders shorting "Wooden Sister" ETFs have already made more gains in January than for the full year of 2021.
So far in 2022, traders shorting ARK funds have made $999 million, surpassing their full-year gain of $941 million last year. S3 noted in a report that in terms of percentage returns, four of the 10 ETFs with the highest profits for bears this month belong to ARK funds.
Wood is known for investing in disruptive innovative technology companies. Rising bond yields and the Federal Reserve's hawkish pivot in recent months have bloodied Ark's favorite high-valued tech stocks, dragging down Wood's fund performance while the ARK fund's bears have made a lot of money.
U.S. stocks rose on Friday, fueled by strong earnings reports from Apple and other big companies, and the S&P 500 and the Dow Jones Industrial Average ended three consecutive weeks of declines. The technology-based Nasdaq Composite rose 417.79 points, or 3.1 percent, to recover all of the lost ground this week. Meanwhile, the Nasdaq Composite index has fallen 13 percent this year.
While Friday's slight rally in U.S. stocks temporarily eased some of the pressure, Wood's flagship fund, the ARK Innovation ETF (tickered ARKK), is still down more than 25 percent so far this year. That puts the fund down more than 50 percent since peaking in February last year.
Short positions are closing
The good news for ARK Investments, though, is that there are signs that the bears are closing their positions.
Ihor Dusaniwsky, managing director and head of predictive analytics at S3, wrote in the report that after such a sharp setback, short sellers have recently made a "big U-turn" and begun to make up positions. He said that in the past 30 days, ARKK's short replenishment has been about $490 million.
"One of the basic reasons for some bearish retracements in the ARKK fund is that the fund's constituents have fallen so much that people think they have bottomed out or are about to bottom," Dusaniwsky said. "Sometimes it's better to quit a little earlier and lock in a profit."