3 Stocks Picked by Cathie Wood to Keep Riding The Bull During Inflation

Cathie Wood, a star stock picker and the CEO of investing firm ARK Invest, believes the stock market is in a bull run that will continue to make investors happy – as long as the United States avoids a recession.

Despite what investors like Michael Burry have predicted, Wood recently said that the market is "probably going to be OK", stating that value stocks, cyclical stocks, and defensive stocks have all continued to rise despite what COVID-19 and a disrupted economy have thrown at it.

"Inflation will unravel quite rapidly," she predicted.

ARK Innovation, Wood's most well-known ETF, is up about 160 percent over the previous three years, despite recent instability. Let's take a look at three firms in which the fund has big holdings and which might profit from a protracted bull market.

Shopify (SHOP)

Wood believes that Shopify, a Canadian e-commerce company, will be able to challenge Amazon, the industry's largest player, in the coming years. According to Wood, Shopify's upside remains appealing due to its distinct offering and first-mover advantage.

"We're trying to figure out how Amazon will deal with people seeing something on Instagram or elsewhere on Facebook, Twitter, or Snap and buying it right there," Wood told BNN Bloomberg recently. "That is a Shopify-enabled commerce potential, and we believe it will be huge." Shopify has already established itself as a major player. The company made over $1.1 billion in revenue in the third quarter and now has a market capitalization of over $180 billion.

The company's stock has increased by roughly 30% this year, which is wonderful news for ARKK shareholders. Shopify is held by the fund in a total of 506,000 shares.

Square (SQ)

Disruption is one of Cathie Wood's favorite things to do. Square is positioned to be a major disruptor in the financial business.

Square began as a digital payment platform and remains one of the industry's leaders, but the company's expanded product portfolio — the ever-evolving Cash App, recent offerings to make crypto investing easier, and the recently acquired Afterpay — should allow it to play a larger role in an increasingly cashless global economy.

Square's third-quarter gross earnings totaled $1.13 billion, up 43 percent year over year. However, the stock price of the corporation has been all over the place this year. It is now down roughly 11% for the year.

Square still occupies a sizable portion of the ARKK portfolio, accounting for around 3.1 million shares or 3.6 percent of the total.

DraftKings (DKNG)

If you're ready to risk your money on the stock market, it makes sense to invest in a business that has gambling at its core.

Sports betting is exploding, especially online. According to Zion Market Research, the sector produced $131 billion in sales in 2020 and is expected to reach about $180 billion by 2028.

DraftKings, as one of the most well-known fantasy sports and online betting sites in the industry, will be at the forefront of that expansion.

In the third quarter, it expanded its operations into three more states, bringing in $213 million in sales, up 60% from the same period previous year.

Wood is still enthralled by what she sees. In November, she added 400,000 shares of DraftKings to two additional ARK ETFs, bringing her total holdings in the business to over 12.3 million.

Growth stocks, to be true, may be quite volatile. And not everyone is comfortable with having assets that fluctuate dramatically week to week.

If you want to invest in something that isn't affected by the ups and downs of the stock market or the cryptocurrency market, you should look at undervalued assets.