Why Cathie Wood Now Expects Ark's Flagship Fund To Quadruple In 5 Years

The ARK Innovation ETF ARKK has trended lower for most of 2021, trading as high as $159 at the beginning of the year before falling below the $100 level this week.

Having faced selling pressure for most of the year, Ark Invest's Cathie Wood thinks her flagship fund is positioned for increased upside over the next five years.

"Our five-year compound annual rate of return expectation has gone from 15% at the peak in March to nearly 40% today," Wood said Thursday on CNBC's "Squawk Box."

Wood expected the fund to double over a five-year period in March, but now expects it to quadruple.

"We could be wrong, but I think our research on innovation is the best in the business," she said.

Wood noted that critics of her investing strategy believe the stocks she is investing in are in a "bubble-like territory."

"We couldn't disagree more because we are seeing five major innovation platforms evolving 14 technologies all moving into exponential growth trajectories simultaneously," the Ark Invest founder said.

See Also: Cathie Wood Continues To Load Up On Blade Air Mobility Stock

Wood told CNBC that when she hears people saying "those stocks are in a bubble, they need to correct," it gives her confidence that "we are nowhere near a bubble, in fact, quite the opposite has happened," Wood said.

"All of the seeds for what is going on right now were planted in the 20 years that ended in a bubble. They've germinated for the last 20, 30, almost 40 years and now they are about to flourish and people are running away."

The people who were burned by the tech bubble are the same ones spreading fear, uncertainty and doubt about the markets right now, according to Wood.

"Here we are ready for primetime and we've got all of this fear, uncertainty and doubt. As a portfolio manager, I actually love that backdrop."

ARKK Price Action: ARK Innovation ETF has traded as high as $159.70 and as low as $89.03 over a 52-week period.

It was down 1.50% at $101.67 at time of publication.

Photo: JoshuaWoroniecki from Pixabay.