Cathie Wood, CEO of ARK Invest, believes the next big wave of innovation is here—and it’s going to change everything. She’s predicting that new tech companies focused on disruptive innovation could grow at a massive pace, with annual returns of 40% to 50%. Meanwhile, the big tech giants—Apple, Amazon, Alphabet (Google), Meta (Facebook), Microsoft, and Nvidia—might only see more modest gains of around 15% to 20%.

Tesla used to be part of this group, often called the “Magnificent 7,” but Wood says it no longer fits in because it’s behaving differently from the others. Now she refers to the group as the “Mag 6.”

In a recent interview, Wood explained how ARK is adjusting its investment strategy. They’ve been taking profits from companies like Tesla and putting more money into cryptocurrencies. She pointed out that October’s sudden crypto market drop affected prices, and news from MSCI about possibly adding digital asset treasury companies to its indexes also added pressure.

When it comes to AI and chips, Wood explained why ARK isn’t heavily invested in Nvidia. Instead, they’re looking more closely at AMD, which they believe has strong potential. She’s also excited about AI-driven robots and innovations in medical devices.

Some people think ARK’s strategy only works when interest rates are low. But Wood disagrees. She highlighted how her firm outperformed in both 2017 and 2018—even when rates were rising. The only real setback came after COVID-19, when rates jumped suddenly.

Wood doesn’t expect that kind of shock again. She believes governments have learned from the pandemic and will be more careful with financial decisions in the future.

ARK’s research report, “Big Ideas 2025,” suggests that by 2030, disruptive innovation could dominate the stock market—making up over two-thirds of global market value. These innovations could grow at an annual rate of 38%, reshaping every industry from the ground up.

According to Wood, traditional industries are likely to shrink in value as new technologies take over. The difference now, she says, is that these technologies are finally affordable and scalable. Unlike during the dot-com bubble, costs have dropped enough for these ideas to go mainstream.

While she still sees some upside for the Mag 6—with expected returns between 15% and 20%—she warns that one or two could fall behind if they don’t keep up with change. Meanwhile, she expects companies built around new technologies to grow much faster.

This belief is reflected in ARK’s recent trading moves. They’ve increased exposure to digital assets and made new investments in Chinese tech companies like Baidu and WeRide. ARK now holds over 2.1 million shares of Tesla but is also betting on other innovative players globally.

Wood also explained how institutional investors typically approach digital assets. Bitcoin gets most of the attention at first due to its dominance. When Bitcoin moves, the whole crypto market tends to follow—like during October’s flash crash.

Ethereum is the second most popular with institutions, especially as more layer-2 solutions like Base are built on top of it. Solana is gaining interest too, particularly for customer-focused use cases.

One big advantage ARK has is its ETF structure. Wood says ETFs allow her team to shift strategies quickly without worrying about investor withdrawals—something mutual funds often struggle with.

In short, ARK is betting big on the future. Their strategy focuses on high-growth areas like artificial intelligence, blockchain, robotics, and biotech. And according to Wood, these innovations aren’t just ideas anymore—they’re ready to reshape the world.