Cathie Wood, head of Ark Investment Management, often adds to her favorite tech stocks when prices fall sharply.
This time, she’s buying the dip in Rocket Lab, adding more than 1 million shares over the past month as the space stock trades sharply below its all-time high.
Last year, the flagship Ark Innovation ETF gained 35.49%, far outpacing the S&P 500’s return of 17.88% in the same period. So far this year, Wood’s flagship Ark Innovation ETF (ARKK) is up 13.29% as of Sept. 3, while the S&P 500 surged 13.18%, Yahoo Finance data show.
Wood gained a reputation after the Ark Innovation ETF delivered a 153% return in 2020. But her style also brings painful losses in bearish markets, as seen in 2022, when the Ark Innovation ETF tumbled more than 60%.
Those swings have weighed on Wood’s long-term gains. As of Sept. 2, her Ark Innovation ETF has delivered a five-year annualized return of -7.60%, while the S&P 500 has an annualized return of 11.06% over the same period, according to data from Morningstar.
Cathie Wood says AI could help support high corporate profits
Wood focuses on high-tech companies across artificial intelligence, blockchain, biomedical technology, and robotics. She believes these businesses have strong growth potential, but their volatility often causes fluctuations in the Ark’s funds.
Over the decade ended 2025, the Ark Innovation ETF wiped out nearly $5 billion in investor wealth, according to an report by Morningstar’s analyst Amy Arnott. That made it the fourth-biggest wealth destroyer among mutual funds and ETFs in the ranking.
Wood remains optimistic about AI, which she sees as a major driver of productivity, economic growth, and corporate profits in the years ahead.
In an Aug. 9 post on X (the former Twitter), Wood said U.S. corporate profits remain unusually strong, with domestic profits before tax at 13.2% of GDP, a level she said is near multi-decade highs.
Related: Cathie Wood buys $53 million of popular semiconductor stock
Some of that strength came from the massive monetary and fiscal stimulus during the Covid pandemic, but Wood believes another factor is helping sustain margins today: Companies are leaning into AI and productivity gains to protect them.
“I think we’re still early in seeing how far that can go,” she said, adding that companies that use AI effectively will “separate themselves from the ones that don’t.”
But not all investors agree with Wood’s optimism. Over the past 12 months through Sept. 2, the Ark Innovation ETF saw roughly $1.82 billion in net outflows, according to data from ETF research firm VettaFi.
Cathie Wood buys $44.5 million of Rocket Lab stock
On Aug. 31 and Sept. 1, Wood’s Ark funds bought a total of 705,102 shares of Rocket Lab Corporation (RKLB), according to Ark’s daily trading information. Based on the latest closing price of $63.81, these stocks were worth about $44.5 million.
Rocket Lab shares have been on a roller coaster this year. The stock hit an all-time closing high of $150.23 on May 27, but has since tumbled about 58% from that peak. Year to date, the stock is down roughly 9%.
Rocket Lab is one of the biggest publicly traded space companies, competing with SpaceX, which Wood is also buying.
Related: Cathie Wood sells $4 million of surging AI stock
The company already has an established launch business built around Electron, its small rocket that carries satellites into orbit. Rocket Lab has signed more than 90 Electron launch contracts, the most in its history, according to its second-quarter earnings report.
Rocket Lab is also working with its $8 billion acquisition of satellite communications provider Iridium Communications (IRDM), a deal that would further expand its business.
In addition, Rocket Lab makes money from its space systems business, which builds satellites, spacecraft components, and other systems for commercial customers and the U.S. government. The company recently won a U.S. Space Force contract to build multiple geostationary satellites, helping push its total backlog to $2.3 billion.
At the same time, Rocket Lab is developing Neutron, a much larger rocket designed to compete for bigger launch contracts. The rocket has been in development for years and is expected to make its first flight later this year or in early 2027.
Rocket Lab’s second-quarter revenue hit a record $234 million, up 62% from a year earlier.
Despite the revenue growth, Rocket Lab remains unprofitable. The company posted a $49.2 million net loss in the quarter and negative free cash flow of $371 million over the past 12 months.
The bigger question for investors is valuation. On a trailing basis, the stock trades at roughly 48 times sales, compared with about 3.8 times sales for the S&P 500, according to The Motley Fool analyst Brett Schafer.
Some analysts are bullish on the stock. Berenberg recently initiated coverage of Rocket Lab with a Buy rating and an $83 price target, pointing to the rapid growth of the space economy as launch costs fall, according to The Fly.
Berenberg expects the space economy, which topped $500 billion in 2025, to exceed $1 trillion by 2030. Berenberg favors companies with “vertically integrated launch and differentiated/sovereign constellation capability that cannot easily be replicated.”
Wood has been aggressively adding Rocket Lab shares, buying more than 1 million shares over the past month. Despite the heavy buying, Rocket Lab is still not a top 10 holding in the Ark Innovation ETF.
Top 10 holdings in the Ark Innovation ETF by weight as of Sept. 3, 2026:
- Tesla (TSLA): 9.53%
- SpaceX (SPCX): 6.17%
- Circle Internet Group (CRCL): 5.43%
- Tempus AI (TEM): 5.17%
- CRISPR Therapeutics (CRSP): 4.79%
- Coinbase Global (COIN): 4.52%
- Robinhood Markets (HOOD): 3.83%
- Twist Bioscience (TWST): 3.43%
- Shopify (SHOP): 3.42%
- 10x Genomics (TXG): 2.97%
Other than buying Rocket Lab (RKLB) shares, Wood’s latest trades included buying Intellia Therapeutics (NTLA) and the 3iQ Solana Staking ETF (SOLQ.U).
She also trimmed positions in Brera Holdings (SLMT), Shopify (SHOP), Twist Bioscience (TWST), Tempus AI (TEM), Deere (DE), and Advanced Micro Devices (AMD).
Related: Elon Musk sends a strong message to Tesla and SpaceX investors
