ARK Invest Chief Cathie Wood believes the rotation from growth into value stocks will become more apparent in the next six months, Seeking Alpha reported.
- In a note, Wood said the rotation into value stocks boosted the rally, reiterating a position she vocalized earlier.
- Wood said the rotation in the past three months was driven by competition as cyclical stocks have temporarily outpaced the growth of early-stage companies.
- Another driver is the uptick in inflation, coupled with higher interest rate expectations that has pushed up discount rates used in valuation of long term cash flows.
- Wood said the reasons will unwind in the next six months or sooner given what she called was “extreme volatility” in the markets.
ARKK: NYSEARCA is up 0.84% premarket.