David Tepper’s Appaloosa Hedge Fund Increases Investment in Uber and Ventures into Cathie Wood’s Innovation Fund
David Tepper’s Appaloosa Management has raised its stake in ride-hailing company Uber and added a small bet on Cathie Wood’s flagship ARK Innovation ETF. The hedge fund has accumulated 12.3 million Uber shares as of the end of Q1 2023, up from 11.56 million shares at the end of 2022, according to a regulatory filing. The company said in the filing that it has increased its commitment to Uber over the past few months as it believes that the company’s growth prospects are undervalued.
Tepper’s Bet on the ARK Innovation ETF
The investment in Cathie Wood’s innovation fund is a new move for Tepper’s hedge fund. Appaloosa has contributed a small bet in Wood’s flagship ARK Innovation ETF by acquiring 5,000 shares that were worth $1.27 million as of March 31. The ARK Innovation ETF, which invests in a range of disruptive technologies such as artificial intelligence, gene editing, fintech, and robotics, has had a volatile year so far. In August 2022, the fund hit an all-time high of $168.06 before falling to $96.84 in December. Since then, the fund has made a modest recovery and is currently trading around $119.
The Rationale Behind Tepper’s Investment
The increased stake in Uber and the ARK Innovation ETF investment showcase Tepper’s confidence in the long-term growth prospects of these companies. Appaloosa is known for its contrarian investment strategies and opportunistic moves in the market. The firm’s previous investments in undervalued companies have yielded significant gains. With the ride-hailing space set for more disruption with the advent of smart cities and autonomous vehicles, Appaloosa’s bet on Uber seems like a calculated move.
Similarly, the ARK Innovation ETF investment highlights Tepper’s faith in disruptive technologies and growth-focused companies that have the potential to deliver high returns over the long term. The fund’s top holdings include companies like Tesla, Square, and Roku, all of which are expected to lead their respective industries in the coming years.
Final Thoughts
David Tepper’s Appaloosa Management is known for its shrewd investment strategies and opportunistic moves in the market. The hedge fund’s increased stake in Uber and its bet on the ARK Innovation ETF are a testament to its long-term investment philosophy. While the future prospects of these companies are subject to market fluctuations and macroeconomic factors, Appaloosa’s decision to bet on them highlights their faith in the growth potential of these companies.
Disclaimer: The written content is purely informative and not intended to provide investment advice. Before making any investment decisions, it is crucial to conduct due diligence and seek the advice of a financial expert.