Ark Invest recently made headlines with their decision to sell 74,291 Coinbase shares, valued at $20.8 million, across three of their exchange-traded funds. This move comes shortly after the firm sold over $100 million worth of Coinbase shares last week as the price of COIN reached new yearly highs.
One of Ark Invest’s strategies is to keep any single holding below 10% of an ETF’s portfolio for diversification purposes. This means that as Coinbase’s stock rises, the firm may continue to rebalance their funds to maintain this threshold. Currently, Coinbase is the largest holding in ARKK, ARKW, and ARKF ETFs, weighing in at 10.6%, 10.9%, and 12.7%, respectively.
Over the past year, ARKK, ARKW, and ARKF have seen impressive gains of 29.5%, 58.2%, and 59.5%, respectively. Despite this strong performance, Ark Invest recently decided to sell off $7.9 million of Jack Dorsey’s Block shares and $31.5 million of Robinhood (HOOD) stock.
Coinbase’s stock closed at $279.71 on Monday, marking a nearly 10% increase for the day and a 25% rise over the past week. Year-to-date, COIN has surged by 62%, according to TradingView data. However, Coinbase shares are still trading 18% below their all-time high of $342.98 in November 2021.
Coinbase’s recent rally coincided with a broader downturn in U.S. stocks on Monday. The company’s shares have closely mirrored those of the cryptocurrency market, particularly Bitcoin, which recently rose above the $70,000 threshold. As of the time of writing, Bitcoin is trading at $70,500, reflecting a 5% increase over the last 24 hours and a 12% rise in the past week.
The recent sell-off of Robinhood and Coinbase stocks by Ark Invest aligns with Cathie Wood’s pessimistic short-term outlook on crypto stocks. Despite this, the firm is reportedly considering an investment in the upcoming Reddit IPO, showcasing their willingness to adapt and explore new opportunities in the market.
Ark Invest’s decision to sell off a significant portion of their Coinbase shares and adjust their portfolio reflects the ever-evolving nature of the cryptocurrency market. As the market continues to fluctuate, investors must remain vigilant and adapt their strategies accordingly to stay ahead of the curve.