Cathie Wood's ARK Fund buys Nvidia again after three months, while also significantly increasing crypto stock holdings

Cathie Wood-led ARK Investment Management purchased 93,374 shares of Nvidia stock on November 16 through its flagship fund, ARK Innovation ETF, marking the first increase in holdings since August 4. On the same day, ARK’s three major ETFs aggressively increased positions in cryptocurrency-related stocks, including Coinbase (10.1 million USD), Ethereum ecosystem service provider BitMine (9.9 million USD), stablecoin issuer Circle (9 million USD), and Bullish (9.65 million USD).

This move occurs during a deep correction in the cryptocurrency market—Bitcoin’s 24-hour decline reached 7.41% to $85,641, and the total global crypto market cap has evaporated about $1 trillion from last month’s high, highlighting ARK’s contrarian strategic commitment to the digital asset space.

ARK Funds Re-enter Nvidia: Timing and Strategy Analysis

Following Nvidia’s better-than-expected earnings report, ARK Investment Management swiftly acted by purchasing 93,374 shares of Nvidia via ARK Innovation ETF (ARKK), valued at approximately $16.8 million based on closing prices. The timing is noteworthy: Nvidia’s stock surged over 5% after the earnings release but ultimately closed down 3.2% at $180.64, reflecting market concerns over AI bubble fears and uncertainty about the Federal Reserve’s interest rate policy. Notably, this increase breaks a three-month silent period since August 4 during which ARK did not buy Nvidia shares, indicating a renewed recognition of Nvidia’s long-term value as a leader in AI computing.

As of September 30, ARK’s funds held over 1.1 million Nvidia shares. Although the recent purchase was modest in size, it carries significant signaling implications. The trading update reflects active management decisions and does not include investor-initiated inflows or outflows. In a context where ARKK’s price has fallen over 20% from its October high (compared to a 4.3% decline in the Nasdaq 100), this operation can be viewed as a continuation of a “buy the dip” strategy in innovative tech, aligned with Cathie Wood’s long-standing philosophy of disruptive innovation.

Nvidia, as a core AI computing supplier, is deeply intertwined with ARK’s focus on five major innovation platforms: artificial intelligence, blockchain, gene sequencing, energy storage, and robotics. Despite short-term pressures from inventory adjustments and intensified competition, Nvidia’s data center revenue grew 27% year-over-year in the quarter, and its gaming business is beginning to recover. This selective increase may be based on the judgment that as AI infrastructure expands into applications, demand for computing power will sustain structural growth, and market volatility creates entry opportunities for long-term investors.

ARK Investment in Nvidia: Key Data

Position Change

Latest purchase: 93,374 shares

Purchase date: November 16

Last purchase: August 4

Total holdings (as of September 30): Over 1.1 million shares

Market Performance

Nvidia closing price: $180.64

Intraday volatility: +5% in the morning, down 3.2% at close

ARKK performance: down 20% from October high

Nasdaq 100 (same period): down 4.3%

Related Transactions

Same day purchase of Robinhood stock: $6.8 million

Via ETFs: ARKK, ARKW, ARKF

Major Rebalancing of Cryptocurrency Stock Portfolio

On November 16, ARK Investment Management completed the largest daily purchase of the week, injecting approximately $38.65 million into crypto concept stocks through its three ETFs (ARKK, ARKW, ARKF). The most notable is the $10.1 million investment in Coinbase, marking a second consecutive week of increased holdings despite its stock falling 7.44% to $238.16 that day. Also noteworthy is a $9.9 million investment in Ethereum ecosystem service provider BitMine, which focuses on staking and treasury management services for institutional clients; its stock plunged 10.83% on the day.

In the stablecoin sector, ARK invested $9 million in Circle Internet Financial, whose USDC stablecoin has a circulating supply of $32 billion, accounting for 22% of the stablecoin market. Despite a 4% drop in Circle’s stock to $66.93, its collaborations with BlackRock on yield products and expansion in cross-border payments may underpin ARK’s investment thesis. Bullish received a $9.65 million injection, supported by notable investors like Peter Thiel, with a slight 0.3% gain that day but a 37.88% decline over the past month.

This contrarian stance reflects ARK’s unique understanding of the crypto industry cycle. Historically, ARK tends to increase exposure during deep market downturns, such as during the Terra/Luna collapse in 2022, when it continued buying Coinbase stock. Currently, with global crypto market cap down about $1 trillion from last month’s high and Bitcoin falling over 30% from its peak, the environment offers opportunities for long-term accumulation. It’s important to note that ARK’s purchases focus on infrastructure and service providers rather than direct crypto holdings, maintaining compliance and liquidity.

From a capital allocation perspective, ARK’s investments in crypto stocks are balanced. Each of the four leading companies received roughly $9-10 million, indicating a diversified approach rather than betting on a single winner. This complements their holdings in Nvidia and Robinhood, forming a comprehensive innovation ecosystem from computing infrastructure to trading applications, spanning traditional and decentralized finance.

Market Reaction and Tech Stock Trends

Market reactions post-Nvidia earnings reveal complex investor sentiment toward the AI craze. Nvidia’s Q3 revenue reached $18.12 billion, surpassing estimates of $16.19 billion, with a strong Q4 outlook of $20 billion ± 2%. Yet, the stock retreated after a brief surge, illustrating a “good news is bad news” phenomenon driven by fears over AI sustainability—concerns over potential spending cuts amid economic slowdown and competitive pressures from AMD and Intel in AI chips.

Asian markets responded swiftly; on November 17, South Korea’s Kospi fell 3.2%, Taiwan’s Weighted Index declined 3.5%, with Samsung Electronics and TSMC down 4.1% and 3.8%, respectively—both Nvidia’s key supply chain partners. This synchronized decline indicates that global tech sentiment is highly correlated, especially for hardware related to AI compute capacity. Analysts suggest that markets are reassessing AI investment return cycles, with overhyped stocks undergoing valuation adjustments.

Crypto stocks saw sharper declines. Besides Coinbase, BitMine, and Circle, mining companies Marathon Digital fell 12.3%, Riot Platforms declined 9.8%, reflecting the broader crypto market weakness. Data shows global digital asset market cap dropped 6.26% in 24 hours, Ethereum down 7.8%, Solana down 9.2%, and the Fear & Greed Index falling to 35 (fear zone). This synchronized decline underscores increasing correlation between traditional markets and crypto assets, especially amid changing macro expectations of Fed policy.

Uncertainty over Fed rate hikes intensified market volatility. According to CME FedWatch, the probability of a December rate hike increased from 45% to 62% over the past month, putting pressure on growth stocks and rate-sensitive assets like cryptocurrencies. ARK’s aggressive buying at this juncture may reflect contrarian logic—signs of economic slowdown increase the likelihood of the Fed pausing or reversing rate hikes, enabling innovative assets to rebound early in the next liquidity cycle.

Crypto Market Correction Context

The global crypto market has experienced its deepest correction since October highs, with total market cap falling from $2.9 trillion on November 8 to about $1.9 trillion, evaporating roughly $1 trillion in two weeks. Bitcoin, the market leader, declined 12.6% from a $98,000 high to $85,641, amid rising expectations for approval of spot Bitcoin ETFs, but also increased market fragility. Contributing factors include regulatory uncertainty, leveraged liquidations, and declining risk appetite in traditional finance.

On-chain data indicate large-scale deleveraging during this correction. Glassnode reports that total crypto leverage contract liquidations over the past week reached $4.2 billion, with 68% long positions. Notably, Bitcoin futures open interest decreased 25%, and funding rates for perpetual contracts turned negative, signaling a shift from overoptimism to caution. Such deleveraging often results in overshooting, with price declines exceeding fundamentals, creating entry points for long-term investors.

Regulatory developments also played a key role. The US SEC delayed decision on multiple spot Bitcoin ETF applications, including proposals from BlackRock and Fidelity, dampening short-term institutional optimism. Additionally, the US Treasury issued draft rules requiring broker-dealers to report customer transactions, raising privacy and compliance concerns. These developments remind investors that institutionalization of crypto still faces policy hurdles.

Technically, Bitcoin’s key support levels lie between $83,000 and $85,000; breaking below could see further drops to around $78,000. Interestingly, on-chain indicators show that long-term holders (addresses holding over 155 days) did not sell significantly during this decline, with some even increasing holdings—similar to bottoms in March 2020 and November 2022—suggesting the current correction may be approaching a bottom rather than signaling a full bear market.

ARK’s contrarian investment approach during this synchronized correction in tech and crypto highlights confidence in long-term value. By reasserting faith in Nvidia and increasing positions in major crypto concept stocks, ARK demonstrates how professional investors can leverage structural opportunities amid macro uncertainties. As Fed policy paths become clearer, whether ARK’s contrarian bets will prove prophetic—embodying the “be fearful when others are greedy” ethos—remains to be seen.

FAQ

Why did ARK increase its Nvidia holdings now?

ARK bought after Nvidia’s earnings exceeded expectations but the stock pulled back, possibly reflecting confidence in the long-term demand for AI computing power. The dip provided a better entry point, consistent with ARK’s disruptive innovation long-term strategy.

Which crypto-related stocks does ARK hold?

ARK’s three ETFs hold major crypto platforms: Coinbase (10.1 million USD), Ethereum ecosystem provider BitMine (9.9 million USD), stablecoin issuer Circle (9 million USD), and another exchange Bullish (9.65 million USD), all acquired during the current market downturn.

How has the crypto market performed recently?

Global crypto market cap fell about $1 trillion from the previous high, with Bitcoin down 7.41% to $85,641, Ethereum down 7.8%, and a market fear index at 35, indicating widespread correction.

Why did Nvidia’s stock decline after a strong earnings report?

Despite exceeding revenue and outlook expectations, concerns over AI bubble risks, and the impact of possibly sustained high interest rates, led to profit-taking and a correction in the stock.

What characterizes ARK’s investment approach?

ARK employs contrarian and long-term strategies, focusing on AI, blockchain, gene sequencing, and other disruptive platforms. It increases exposure during market fears, maintains liquidity through ETF diversification, and emphasizes long-term value creation.