Cathie Wood Overshadowed by Warren Buffett's Wisdom

2024-05-13
Summary:

Warren Buffett led Berkshire Hathaway's annual meeting solo for the first time in decades last week, concluding with a clever quip during the Q&A.

Last week Warren Buffett presided over the Berkshire Hathaway's annual meeting without his partner Charlie Munger for the first time in decades. He also wrapped up the Q&A session with a witty remark.

Cathie Wood and Warren Buffett

"I not only hope you come next year. I hope I come next year," he said, laughing. According to succession plan, Greg Abel will replace him in making all major investment and capital allocation decisions.


The Oracle of Omaha will be remembered for his investment philosophy after he passes away sometime in the future. Unfortunately, most rising stars in the industry have been nothing but a flash in the pan.


Cathie Wood looks increasingly likely another example of that. Her firm ARK Invest has destroyed an estimated $14.3 billion in wealth over the past decade, according to a recent Morningstar analysis.


ARK's flagship innovation ETF, ARKK, soared nearly 150% in 2020, which helped drive a surge of inflows into its funds right near its peak. But during the 2022 bear market, ARKK plunged as much as 67%.


The firm's top holdings currently include Coinbase, Tesla, Roku, and Zoom Video, all of which have had a rough start to this year. Wood's dumping Nvidia and buying Tesla in Q1 is also making clients frown.


Buffett said he still advises his wife to allocate 90% to a low-cost S&P 500 index fund which beats the vast majority of active fund managers over the long term. It is a simple panacea to wealth building for everyone.


Disclaimer: This material is for general information purposes only and is not intended as (and should not be considered to be) financial, investment or other advice on which reliance should be placed. No opinion given in the material constitutes a recommendation by EBC or the author that any particular investment, security, transaction or investment strategy is suitable for any specific person.

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