Cathie Wood, founder and CEO of ARK Investment Management LLC, speaks at the Skybridge Capital SALT New York 2021 conference in New York City on September 13, 2021. Source: Brendan McDermid/Reuters.
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  • Star stock picker Cathie Wood has reiterated her prediction that slowing economic activity in the US will boost growth stocks
  • She cites underwhelming jobs growth in August and a weakening consumer price index as signs that the US economy will grow at a slower pace
  • Wood’s portfolio, which has weighty positions in growth stocks, is down 5.5 per cent so far this year — well behind the 19 per cent gain for the S&P 500
  • Separately, Wood said she expects Bitcoin to hit US$500,000 (A$683,150) in five years and that her firm’s conviction in Ether has strengthened

Star stock picker Cathie Wood, of New York-based investment firm ARK Invest, reiterated on Tuesday her prediction that slowing economic activity in the US will boost growth stocks.

Ms Wood cited underwhelming jobs growth in August and a weakening consumer price index as signs that the US economy will grow at a pace slower than many on Wall Street expected at the start of the year.

“We think we are moving into the other side of the cycle,” she said during a webinar.

Her comments come after the reopening of the US economy from the coronavirus pandemic led to widespread commodity shortages earlier this year and bolstered cyclical value stocks.

“We do believe that the market will start rotating back toward growth and innovation.”

Ms Wood’s portfolio, which has weighty positions in growth stocks such as Tesla, Teladoc Health and Unity Software, is down 5.5 per cent so far this year — well behind the almost 19 per cent gain for the S&P 500.

In afternoon trading on Tuesday, the fund fell 0.4 per cent, putting it in the lowest percentile among the 593 US mid-cap growth funds, according to Morningstar.

Separately, at the SALT Conference in New York on Monday, Ms Wood said she expected Bitcoin to soar to US$500,000 (A$683,150) in five years and that her firm’s conviction in Ether had strengthened immensely.

In an interview with CNBC anchor Andrew Ross Sorkin, Ms Wood said her prediction depended on whether companies continued to diversify their balance sheets into Bitcoin and whether institutional investors would begin to allocate 5 per cent of their funds to it.

If that happened, “we believe that the price will be tenfold of where it is today,” she said. “So instead of $45,000, over $500,000.”

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