Dec 27 (Reuters) - U.S. tech investor Cathie Wood is urging Donald Trump's incoming administration to enhance economic growth and policy certainty by retroactively implementing proposed corporate and personal tax cuts to Jan. 1, 2025, as she revealed to Reuters.
After a period of underperformance, Wood's flagship ARK Innovation exchange-traded fund (ARKK.P) has surged 17% post-Trump’s win, with anticipated policy changes set to benefit the fund's assets.
Two key stocks in the fund, electric carmaker Tesla (TSLA.O) and crypto exchange Coinbase (COIN.O), have already seen gains of 54% and 7% respectively since Nov. 6, outpacing the S&P500 which rose about 1.7% during the same period.
Other top holdings of ARKK like Robinhood (HOOD.O) and Block (SQ.N) could also benefit from favorable crypto and AI policies.
Publicly supporting Trump's economic agenda, Wood backs his plans to facilitate deals, advance innovation in crypto and AI, and reduce bureaucracy and government expenses to support corporate interests.
Tax policy played a crucial role in the election, with Trump vowing to lower rates for U.S. manufacturers and extend individual tax cuts set to expire next year.
Wood emphasized the need for clarity on tax reform, advocating for certainty in the markets through retroactive tax cuts starting from Jan. 1, 2025. She warned that uncertainty might lead companies and individuals to hold back investments.
Despite not generally supporting tariffs as they escalate taxes on goods, Wood views Trump's threats to increase tariffs on major trading partners as a negotiation tactic.
Anticipating tax reform by the new Republican-led Congress next year, analysts project Trump will initiate key policies through executive orders post his Jan. 20 inauguration.
Although Wood didn't financially support Trump's 2024 campaign, she met him once this year, while maintaining connections with Elon Musk of Tesla and Senator Cynthia Lummis, who shape Trump's policies.
Wood's considerable investment in Tesla reflects her trust in Musk and belief in AI's potential. She is reallocating some Tesla shares to companies poised to benefit from similar trends, like Archer Aviation (ACHR.N), a firm focused on autonomous aircraft.
A leading advocate for crypto, ARK introduced a bitcoin ETF in January. Wood suggests the U.S., under President Biden, risks losing out on innovation if it clamps down on crypto, positing that the new administration aims to prevent such a scenario.
Remaining optimistic about the market's trajectory post-Trump, especially for innovation-driven sectors, Wood expects a broader market expansion benefiting those previously hindered by policy constraints.