"Science and Technology Innovation Board Daily" (editor Zheng Yuanfang), since the beginning of 2022, under the wave of technology stock plunge, the head of ARK Invest, Cathy Wood's fund, known as the "goddess of technology stocks" and "wooden sister", has performed dismally, and the ARK Innovation ETF has fallen by nearly 28% during the year.
Wood is known for investing in disruptive innovative technology companies. Fueled by recently rising bond yields and the Federal Reserve's hawkish turn, Ark's beloved high-valued technology stocks have been bloodied.
A few days ago, Ark Investment released its New Year's investment strategy as scheduled, and the overall technology innovation is still the core.
In the opening chapter, Wood lists six major risks of investment in technology innovation, namely rapid development, regulatory obstacles, diverse fields and market capitalization, political or legal pressures, uncertainty and unknown, and fierce competition.
It then reiterated its penchant for disruptive technological innovation: change developed slowly at first, and then turned upside down in an instant. Future innovation will replace existing industries, pull efficiency and increase market share, which is an exponential growth opportunity.
Today, the five major areas of AI, robotics, energy storage, DNA sequencing, and blockchain are constantly evolving and converging, which is also the core research direction of Ark Investment; among them, the report points out that with the cost of downward exploration, there are currently 14 technologies that are approaching the tipping point of outbreak (below). When future historians look back on this era, they will call it an "unprecedented period of technological boom" – that everything has changed.
In 2022, the top five industries favored by Wood in terms of return on investment performance are AI, battery technology, blockchain, robotics and gene sequencing. Ark Investment expects that the long-term returns of the above industries are more substantial; from 2020 to 2030, the average annual compound growth rate of these five major industries will increase by 26%, 35%, 43%, 51% and 40% respectively.
At the same time, Wood also makes specific outlook analysis of many segments in the above industries, for example,
In the field of electric vehicles, with the increase in mileage, the price of electric vehicles is continuing to decline, and the biggest concerns of consumers about buying electric vehicles have been eliminated. Ark Investment predicts that by 2026, electric vehicle sales will increase by about 8 times, from 4.8 million in 2021 to 40 million. In the development process, the biggest downside risk lies in whether traditional automakers can successfully transition to electric autonomous vehicles.
In addition, batteries account for the largest proportion of the cost of electric vehicles, affecting whether the latter can compete with the price of fuel vehicles. According to Huai's law, for every doubling of production, the cost of the battery will drop by 28%,, and lithium iron phosphate batteries are also extremely important in the cost of exploration.
In the field of autonomous driving, Ark Investment is optimistic about the self-driving car ride-hailing platform. It expects that in the future, autonomous ride-hailing platforms will reduce the cost of travel by one-eighth, thereby expanding their use, compared with current ride-hailing services, and will add about $26 trillion to global GDP annually by 2030.
In the field of automated logistics, automated logistics including trucks, drones and robots can reduce costs, increase speed and convenience. Ark Investment expects that in the future, automated logistics revenue is expected to grow from the current "zero" to $900 billion by 2030.
In the field of AI, while the training cost is rapidly decreasing, the performance is also significantly improved. In the future, the market value of AI software and hardware companies will grow at an annual rate of 50%, from $2.5 trillion in 2021 to $87 trillion in 2030.
In the field of digital wallets, since 2017, digital wallets have begun to dominate e-commerce payments, and will become the primary payment method of offline and online in the future. In the next five years, the annual growth rate of global digital wallets is expected to reach 78%, and the market size will grow from $1.1 trillion to $20 trillion.
In the field of gene editing, with the integration of next-generation DNA sequencing, CRISPR gene editing and AI, healthcare is expected to usher in changes, the pace of scientific research is accelerating, and medical research areas tend to be personalized. The compound growth rate of the market capitalization of gene editing and gene therapy companies is expected to reach 54%, from the current $130 billion to $1.1 trillion in 2026.