ARK Invest founder Cathie Wood is a long-time Tesla bull. Her 2026 price target for the electric-vehicle maker’s shares is $4,600. Tesla, though, isn’t the largest holding in ARK Innovation ETF anymore.
That distinction now goes to video streaming streaming service provider Roku (ticker: ROKU). It accounts for about 8.4% of ARK Innovation’s holdings. Tesla (TSLA) accounts for about 8.2% of the fund.
Tesla doesn’t seem to have lost its top spot as part of an explicit trading strategy. Recent stock market performance has changed the relative rankings. Coming into Friday trading, Tesla stock has dropped 27% over the past month. Roku has declined only 12%.
Tesla stock has been battered by the tech selloff. CEO Elon Musk’s potential purchase of Twitter (TWTR) also has become an overhang on the shares. Tesla stock is down about 38% since Musk’s initial Twitter stake was disclosed. The S&P 500 and Nasdaq Composite have fallan about 15% and 22% over the same span.
Investors appear to be worried about how much Musk has on his plate. He runs Tesla, SpaceX, The Boring Company and Neuralink. Musk took to Twitter on Friday to reassure Tesla shareholders than Twitter was only taking about 5% of his time and Tesla was on his mind 24/7.
The decline in Tesla stock, along with other high-growth names, has hurt Wood’s fund. ARK Innovation is down about 23% over the past month and about 55% year to date.
Investors have shunned the highest growth, more speculative stocks as interest rates have risen. High-growth companies generate most of their earnings far in the future and higher interest rates make those earnings worth less when discounted back to today. That’s one reason why rising rates tend to hurt richly valued stocks more than others.
Tesla stock was is up about 2.3% in premarket trading on Friday. Roku shares have gained about 2.5%. S&P 500 and Dow Jones Industrial Average futures rose up about 1.1% and 0.9%, respectively.
Write to Al Root at firstname.lastname@example.org