2023-05-04 09:13:28 ET
Cathie Wood and Ark Invest believe that there is much more weakness in the global economy than most are projecting and much of it can be seen through the recent regional bank fallout.
While some believe the contagion in the banking sector is being contained, Wood stated in an interview with TD Wealth: "I think it's accelerating, contrary to what Jamie Dimon said after buying First Republic."
Wood believes that the regional bank space telegraphs the fact that capital deposits are exiting the system, leading her to conclude that "we've started in the early stages of a credit crunch that is going to be much more serious than I think most are expecting.”
The asset manager added that she believes that deposits will continue to outflow until the Federal Reserve reverses its position and marks a clear pivot.
For investors that want to keep a closer eye on the state of the regional banking sector they can look towards these two exchange traded funds: The SPDR S&P Regional Banking ETF ( KRE ) and iShares U.S. Regional Banks ETF ( IAT ).
Furthermore, see the year-to-date performance of Wood’s actively managed ETFs below:
- ARK Innovation ETF ( NYSEARCA: ARKK ) +14.1% .
- ARK Next Generation Internet ETF ( NYSEARCA: ARKW ) +20.8% .
- ARK Fintech Innovation ETF ( NYSEARCA: ARKF ) +19.7% .
- ARK Autonomous Technology & Robotics ETF ( BATS: ARKQ ) +11.8% .
- ARK Genomic Revolution ETF ( ARKG ) +4.5% .
- ARK Space Exploration & Innovation ETF ( ARKX ) +8.2% .
See the complete interview with Cathie Wood here.
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Cathie Wood thinks regional bank fallout is accelerating