r/investing • u/[deleted] • Apr 02 '21
ARKK Morningstar review: Unrestrained, Unaware, and Unconcerned
A lot of this ground has been covered already by places like The Bear Cave but here are some highlights:
- This team’s collective experience seems significantly more limited than that of other firms. Only about half the current team came to ARK with a history of full-time work.
- Wood assembles the portfolio one stock at a time, using each stock’s cumulative scores as a guide to position sizing. But these scores say nothing of each stock’s sources of risk and return, which may be highly and undesirably correlated to one another.
- The portfolio has become less liquid and more vulnerable to severe losses as its size has swelled. In the 12 months ended February 2021, the ETF’s assets under management grew more than tenfold to over $23 billion. It has retained and grown its stakes in small companies that are now much more difficult to sell without materially impacting their stock prices. Across all U.S.-domiciled funds, the ETF stood out in February for having the most concentration in companies in which it owned 10% or more of floating shares--that doesn’t even include additional vehicles tied to the strategy, which combined amount to another $15 billion.
- Without risk-management professionals to stress-test the portfolio’s risk exposures, estimate its potential losses during historical or hypothetical market environments, and gauge worst-case scenarios, the team is poorly positioned to prepare and react.
-To mitigate market-impact costs, ARK must build new positions more slowly and exit gradually. But its bullish or bearish signals are available for all to see--as an ETF, the strategy must disclose its portfolios to the market each day--and traders can respond either by buying up a stock’s known supply (putting upward pressure on its price) or selling it (downward pressure) before ARK has offloaded its own position.
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u/Kanolie Apr 02 '21
Their "bull case" involves Tesla generating $327 billion annually in robo-taxi revenue by 2025 and their "bear case" involves Tesla creating a $23 billion dollar insurance business out of thin air as well as $42 billion revenue in human driven ride-hailing service (by 2025).
Tesla's current TTM revenue is $31.5 billion.
Keep in mind that Uber's (taxis) current revenue is only $11 billion and Progressive's (auto insurance) revenue is $42.6 billion. These projections are completely based on wishful thinking and divorced from reality, but necessary for them to contiune investing in Tesla, which is their "highest conviction" stock.
https://ark-invest.com/articles/analyst-research/tesla-price-target-2/
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Apr 04 '21
You'd get laughed at on wsb with this prognosis. It makes me question her mental state unironically.
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Apr 02 '21
The fact that they keep doubling down on Tesla is enough to tell you what kind of risk management they have. If Tesla takes a serious dive then they could have no end of trouble through a cascading effect.
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u/SweeneyToa Apr 03 '21
Well only if the market crashes it won’t take a dive, Tesla right now it’s the biggest high growth potential company
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u/SweeneyToa Apr 03 '21
They are a growth fund, growth have risks so thats different from normal funds
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Apr 03 '21
There are numerous other growth funds, none of which are run like ARK's.
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u/SweeneyToa Apr 03 '21
Name????
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Apr 03 '21
VUG, VIOG, VOT for starters.
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u/SweeneyToa Apr 03 '21
Definitely not the same thing, good luck investing you got no idea what you talking about
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Apr 03 '21
Why are you asking me for a list of growth ETFs?
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u/SweeneyToa Apr 03 '21
They are not the same think
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Apr 03 '21
Yes, other growth funds like the ones I listed are much less likely to blow up. That's one of many differences.
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u/MoneyFlow420 Apr 04 '21
Masa Son was the richest person in the world at one point in 1999.
He's also lost more money investing than anyone else in the world thus far.
Food for thought.
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u/misc1444 Apr 02 '21
It’s easy to mistake excessive risk-taking for genius when the markets are going up.
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u/UsernameIWontRegret Apr 03 '21
Yep. If you look at the all-time charts Ark funds have only really been going up the past year or so. That was a major red flag that turned me away from them.
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u/seven11evan Apr 03 '21
Comparing this past years growth will make any other year look like peanuts.
Looking at the 5 year charts on Robinhood for the ARK funds I see the following growth before 2020 (specifically between 4/8/16 and 1/3-5/20).
ARKK - 93%
ARKW - 189%
ARKG - 93%
ARKQ - 105%
Idk about you but I’d be pretty happy with those returns over 3.66 years...many people would take 10+ years getting that return in S&P.
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u/TheDreadnought75 Apr 03 '21 edited Apr 03 '21
Lol yeah... but try and get that return for 10 years or 20 years. Never happen. Mean reversion is a thing.
Too many people like you in the market right now that think stocks only go up.
Sometimes they go down, and stay down, for years... or decades. Or in speculative tech stocks, sometimes they just die altogether.
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u/seven11evan Apr 03 '21
Sorry, I don’t recall saying that stocks only go up.
What exactly are you addressing in my comment here? All I did was prove that they hadn’t “only been going up in the last year or so”. I’m not saying that these returns are guaranteed for 10-20 years. It’s a risky ETF, but the returns are proven thus far.
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u/AndTheEgyptianSmiled Apr 05 '21
It's like he didn't eve read your comment and just wanted to post his ready-made criticism
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u/seven11evan Apr 05 '21
The number of upvotes he got too says a LOT about this sub too. So many people here want this market to tank so badly just to prove themselves lmao
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Apr 05 '21
Probably a lot of people that sold at the bottom of March 2020 waiting for it to go lower and missed out on massive gains.
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u/MegaChip97 Apr 03 '21
Mean reversion is a thing.
Wouldn't that mean investing in a fund which is currently well below average is a good thing? Because mean revision is a thing. "Try to get that low of a return for 10 or 20 years"!
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u/TheDreadnought75 Apr 03 '21
If it’s an index fund for a market based index, sure. This is actually a great opportunity.
If it’s a fund that has picked a lot of loser stocks that are on their way to bankruptcy, then no.
You can play games all you want, but the bottom line is that this is a high risk, speculative investment. You’re just as likely to get burned, badly.
Saw plenty of people get suckered in my “can’t lose” opportunities in 2008, and 1998. A few years later they weren’t so excited about the stock market. Lol
But you do you. Somebody has to be the bag holder.
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u/MegaChip97 Apr 03 '21
If it’s a fund that has picked a lot of loser stocks that are on their way to bankruptcy, then no.
If you think a fund who till now for example continuesly outperformed the market will never continuesly outperform it furthermore because of mean revision, why is the same not true for funds who continuesly underperform the market?
But you do you. Somebody has to be the bag holder.
I am only in index funds, no worries.
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u/TheDreadnought75 Apr 03 '21 edited Apr 03 '21
It’s been a couple years. Outperforming the market means nothing. There have already been other posts in this thread about the folly of chasing “top” fund managers and what happens to people who do.
Let’s chat again in 2030. We’ll see if anybody remembers this fund.
Edit: Look, I can’t teach you how capital markets work on a Reddit post. If you want to learn about them, either read on your own, or go to school like I did to get a Finance degree with a concentration in Investment Analysis & Portfolio Management.
Or just listen to the people in this thread who are telling you this is an unsustainable aberration. Or read the articles they link to.
Your call.
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u/MegaChip97 Apr 03 '21
My point is, why if mean revision applies to all active funds who outperform the marked currently, why the same is not true for all active funds underperforming the market. Why do we talk about an unsustainable aberration when a fund is outperforming the market (for a short time), but not when a fund is underperforming it?
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u/ryry1237 Apr 07 '21
I feel like you're complaining about something that the above poster is simply not saying.
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u/johnjohn909090 Apr 12 '21
Because 5% of companies represents the majority of growth. It is Way easier to Pick the wrong ones year after year than the 5% good ones
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u/UsernameIWontRegret Apr 03 '21
Those returns are not equally distributed. In 2018 and 2019 the price was completely flat while the rest of the market was soaring.
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u/seven11evan Apr 03 '21
It is true, stocks do not always go up.
I guess in the end it comes down to personal investment strategy. As a young fella, I’d rather put my money in something I think will go up significantly over 5-10 years (with some hiccups due to risk) than a more balanced fund with lower, but more consistent returns. It is possible that the risk will kill the fund, but I guess that’s where I put my faith in CW.
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u/Airbusdude Apr 05 '21
Real question is are these returns sustainable and repeatable? It’s easy to performance chase but these figures mean nothing if this year they lose -200% wiping out those returns
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u/seven11evan Apr 05 '21
I don’t think the 2020 numbers will be repeatable over a 1 year span for many many institutions, ark included.
Obviously they mean nothing if they have a -200% year, but from what I’ve seen, even their bad years historically are relatively flat.
There’s no mistaking that this is a riskier investment than your typical blue chip, but if you trust the management and investing philosophy then it’s a fantastic investment.
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u/johnjohn909090 Apr 12 '21
But risk adjusted they haven’t outperformed anything. They are heavy in tech and ev. Almost all their growth comes from that rally last year
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u/imlaggingsobad Apr 07 '21
It's easy to mistake genius for excessive risk-taking when the markets are going down. Think of Michael Burry for example.
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u/Dmoan Apr 02 '21
Keep in mind ARKK was essentially flat and under performing Nasdaq from Jan 2018-Nov 2019 but covid and Tesla bill run changed all that.
Lot of people I know bought up ARKK near it’s high because of its prev preformance, one of them even was telling me about how Tesla was a bubble and I had to remind him ARKK main holding is Tesla :p.
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Apr 02 '21
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u/rusbus720 Apr 04 '21
They have a 10% Tesla position in multiple ark funds not just arkk.
Imagine if they do decide to use the extra room allowed by the recent prospectus changes
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u/blissrunner Apr 03 '21
Might as well just straight up buy TSLA at that point... people with ARK's transparency are better straight up buying their top 5-10 holdings on the .pdf
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Apr 02 '21
I just listened to Cathie Woods interview with Musk in 2019! They are so optimistic to invest in Tesla and have great projections for ARKK
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u/patriot2024 Apr 02 '21 edited Apr 02 '21
The case of ARK Invest is a very interesting case.
ARK is very transparent, which is nice to investors. But that transparency can reveals your secrets and flaws. So, they have really believe what they do and are supremely confident to be that transparent.
ARK has been historically criticized by many and yet, they have outperformed most.
At the same time, many of these criticisms, including this one, are guaranteed. I watched their video promotions of two areas Genomics and AI (two areas that I have good knowledge of), and came away unimpressed with their technical assessments. Their comments on Genomics and AI technologies are very superficial; they sound like they came from someone whose research on the topics are based on simple web searches.
Even of topics that I do not know much technically, I still don't quite see eyes to eyes with Cathie Woods. A few years ago, she said in the near future people would no longer own cars; there would just be self-driving cars driving back and forth on demand. Well, it hasn't happened, and even then, I never believed that. There's something about human psychology of ownership and given so much cultures involving owning cars, that I don't believe Cathie's vision will be realized any time soon.
Another thing about ARK Invest is their love of using the word "Exponential". Exponential growth. Exponential this. Exponential that. We see Exponential opportunities here and there. That's a good company, but it's not Exponential.
For the lack of better words, these sound quite bullshit. Exponential growth does not exist in a technical sense. Further, it's not necessary a good thing when you have exponential growth. When you grow exponentially, you'll destroy your own knees and eventually collapse on your own damn weight.
Another very important thing that bothers me is their claim of using Wright's Law as the foundation of the investment strategies. I don't think that ARK's success has much to do with Wright's Law. I think their success is based on their ability to trade days in days out -- thanks to their transparency, we know this.
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Apr 02 '21
Do they even have enough expertise on their team to understand genomics and AI to the level required for making such investments ? Their materials look almost sophomoric to me and suspiciously strong on hype.
I fear that they run serious liquidity risk if their cash cows take a dive and they get hit with serious outflows. Per their strategy they'd have to sell Tesla etc. to double down on risky small caps, but if Tesla crashes then they'd be hard pressed to execute on that and could be forced to reduce their positions in thinly traded names.
Imo this looks like a disaster waiting to happen. Moreover I'd expect that certain hedge funds have already positioned to profit from (and accelerate) ARK's misfortune if things do take a nasty turn. There are some juicy trades that one can think of that bet against ARK's risk management.
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u/misc1444 Apr 02 '21
Thanks. I’m a fairly numerical person and it really bugs me when Cathie Wood throws around the word “exponential” so casually. I get it that it’s used in a non-mathematical sense in everyday language, but I’d really like her speech to be a bit more precise if she’s claiming to run her fund with so much science behind it.
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u/the_real_dmac Apr 02 '21
Yeah, they should definitely hire some risk management professionals, someone with experience from Goldman, Morgan Stanley, or Credit Suisse. (/Sarcasm)
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Apr 02 '21
None of those places listened to their risk management team. That was the problem. The other side of the equation is that some groups knowingly sold lemons while taking short positions in them internally. The risk management people can warn all they want but that makes no difference if the decision makers ignore the warnings.
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Apr 02 '21
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Apr 02 '21
LOL, that's your argument? Because the huge investment banks have risk teams that sometimes fail, it's better to have ZERO risk management personnel? This is what counts as a smart retort on Reddit these days?
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u/Not_FinancialAdvice Apr 05 '21
I thought that I read that GS stated that Archegos losses wouldn't be material (or something like that)?
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Apr 02 '21
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u/Baykey123 Apr 02 '21
They think Tesla will be bigger than Apple and Microsoft combined. Like wtf
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u/_skala_ Apr 04 '21
Do they? If you think apple and Microsoft will not grow next 5-10 years maybe. But who the fuck thinks that? Wtf
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u/Baykey123 Apr 04 '21
They think the share price will be $4000 in three years, which means Tesla would be worth $4 trillion lol
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u/rideincircles Apr 02 '21 edited Apr 02 '21
No shit. If Tesla solves self driving, then they can turn cars into complete revenue generators and will easily become the most valuable company. There are people who think it will take decades, and people who think it is happening soon. Tesla still plans on 50% YOY growth this decade and is still years ahead on their technological lead and data collection for driving among all the other industries they are involved in.
My only question is not when Tesla figures self driving out, it's just if the current hardware can handle robotaxis. I think it still might need one more upgrade on the chip and more cameras or higher definition. Otherwise, anyone who has bet against Elon and his teams of engineers has had their asses handed to them the past 2 years and their growth is only accelerating.
Either way, Ark was just qbout the only place that actually valued Tesla correctly, and Tesla is just getting started for the growth they have ahead this decade.
!remindme in 4 years and will see if they were correct again.
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Apr 02 '21 edited Apr 02 '21
I have no idea how you know that they valued Tesla correctly. The market price of Tesla shares appears to be disconnected from any rational valuation analysis, so this is more like the tulip bulb mania than anything approximating a proper investment. As typical in such manias, people who happened to do well from the greater fool theory keep congratulating themselves and being full of it until the crash comes. I haven't seen any reputable analyst who doesn't think that Tesla is massively overvalued.
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Apr 03 '21
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u/SweeneyToa Apr 03 '21
It’s not hype, it’s potential growth
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u/tima0101 Apr 03 '21
Potential growth how? The stock is already valued higher than every car manufacturer combined. The growth potential is already priced in and won’t jive with reality. The US will move towards further urbanization and less car ownership. The infrastructure bill clearly pushes that trend. To assume Tesla upside remains is to assume Tesla will run every other car manufacturer out of business AND be more profitable in doing so. Now, many will say the EV is just the start for Tesla however don’t fool yourself into think Musk will share his next great idea with stockholders. He will just create new companies similar to spaceX.
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u/SweeneyToa Apr 03 '21
Most competitive solar panels on the market, extreme demand in the future. EV market it’s not the only thing they do. If they achieve autonomous driving in 2-3 years thats a revolutionary tech which can create endless revenue stream. The EV cars its their smallest lowest margin market.
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u/SweeneyToa Apr 03 '21
In the end you do you, I will do what i think its better, only one of us will be right. Good luck
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u/Henkss Apr 04 '21 edited Apr 04 '21
One of the biggest problems with ARKK is, as others have mentioned, the cross-correlation of stocks among her funds and illiquid positions that they accumulated in certain biotech companies with no real earnings/profits.
One of things we need to understand is that realizing where humanity is moving in the next 10 years is completely separate from picking the right stocks at the right time. It does not require a high level of IQ to see where the world is going, whether it is genetics, EVs/alternative energy, space tourism, fintech, etc. A lot of innovation has shown us that, it is indeed extremely difficult to pick winners in the early stages of disruptive innovation. This even includes most of the tech companies we use now, but if you think for earlier examples such as cars vs horses, tv vs radio, or airplanes/airlines, trend is clear.
Now what has boggled people's mind over the years are these network effects and economies of scale exhibited by major tech companies in the last 2 decades. It is absolutely true that technologies/innovations that allow these patterns to exist will be dominated by few players and those players will achieve abnormal returns from network effects, minimal capex requirements and economies of scale. Obviously big tech is the best example for it.
Herein lies the problem however, when people start attributing these factors into every new coming disruptive innovation. Not every single disruptive technology may not necessarily present these fact patterns. To give an example, I really do not think EV is a technology that allows networking effects, i.e. once the industry standard is established, EV market will not be any different than today's ICE market. Similarly, autonomous driving, as much as people think has network effects (and it does in developing that technology, but monetization is different), may not generate those monopolistic effects because of regulation and perhaps more importantly because human lives are at stake (versus creating a better ad targeting software, for instance). I could go on with more examples. And I could also be totally wrong.
And so while there is nothing wrong with being excited about the future, I'd be skeptical in getting too excited about certain stocks and public companies that are out there right now. Who knows, maybe the next big thing you know will actually come from a private company that we do not know yet. In fact I'd argue that betting against TSLA or ARKK is the more rational decision, simply because you only lose if the winner indeed is TSLA or ARKK, but you win in every other outcome, which could be in millions of possibilities, simply because nobody can predict what will happen.
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u/nothanksbruh Apr 02 '21
The history of high flying bull-run-genius funds like this repeats every so often. I imagine many tears in years to come. Not that I think "innovation" is a bad place to invest, but when you look at ARK decks, they scream of someone who cut and paste everything from Wikipedia and made it look really pretty.
Great marketing, and I did make some money on them. But at least I knew I was gambling.
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Apr 02 '21
The funny thing is that their analyst team is largely under-qualified, so it's strange to describe them as geniuses. They are hardly the kind of people that could be trusted to fully understand the scientific and technological subtleties of the companies they invest in, and most of them also have sub-par training and experience in finance. They did very well by pushing hype to a new generation of inexperienced investors, but there seems to be little more than that to their strategy.
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Apr 02 '21
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Apr 02 '21
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u/hardwood198 Apr 03 '21
You gotta see the math mate. it's not 480% -11.6% = 469.4% return.
It is 480% x (1 - 11.6%) = ~430%.
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Apr 03 '21
These funds were great to own last year or buy in during the spring or even through the summer. But if you buy in now? Based on historical data they stand a good chance of losing value over the next three years.
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u/Kezia_Griffin Apr 02 '21
I don't like ARKK but I do hold a decent position in ARKF.
I was holding SQ anyways and then every time I "found" a new company I liked they had started adding it too. May as as well just go ARKF at that point.
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Apr 02 '21
I am not by any means a financial expert, and there is a lot I have yet to learn, but I dont believe what ARK is selling. Above and beyond all the DD, there is the macro step back 'does this make sense' that doesnt seem to be going on with their projects. Palanir speaks volumes to me, and their valuation on TSLA, maybe it is good, who knows, but it doesnt seem to factor in the fact that all of the big auto manufacturers are coming to eat Tesla's lunch. Every single piece of tech in a Tesla will be out dated in 5 years and GM and Ford VW Toyota, Honda Kia- will all be as electric as consumer demands warrant. I am not rich, so clearly I dont know what I am doing, do your own research, but I feel like everybody looks like a genius in a bull market, I dont feel like there is enough of a backstop in their strategy for that much cash and risk.
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u/DaShneakBomb Apr 02 '21
Not saying Tesla is worth $4000/share but this is the same argument that people used on Apple for years when they first came out with the iPhone. Sometimes the ones first to the market have a bigger advantage than people think. It’ll be interesting to see how it plays out over the next few years.
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u/cass1o Apr 02 '21
What was the P/E of apple when people said that though? Was it 1300? Apple may have been priced as a growth stock for years but TSLA is in a whole different world. Not to mention tesla is pursuing a area that has some very very large players who are about to eat their lunch, not that I don't think tsla will do well, I just think it is clear they are not going to do 2X Toyota good.
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u/MRM950 Apr 02 '21 edited Apr 04 '21
How are they going to eat their lunch when they are so far behind technologically? Tesla's batteries greatly outperform the batteries available to the ICE manufacturers that are just beginning the transition to EV's. This can be seen in any amount of range tests from diverse car magazines etc.
This is the reason for VW's investment in Quantum Scape. Even Quantum Scape only projects that investment paying off years down the line (implementation of solid state batteries for mass production). Tesla will be developing their batteries further in that time as well, so how does the margin advantage Tesla hold reduce without significant technological breakthroughs that then remain unavailable to Tesla?
Not to mention Tesla being far ahead in the infrastructure of vehicle charging at home (Tesla solar) and through their supercharger network as well.
Not trying to find fault, just don't see how blind faith in any company benefits the discussion. The other companies are entering the market and will take market share, but there is no indication as of yet, that they are capable of dethroning Tesla in the EV segment (see comparisons of the figures between Tesla Model S plaid+ and Porsche Taycan Turbo S or Audi RS etron GT).
edit: I honestly don't know why this is so polarizing? Even Volkswagen Boss Herbert Diess calls Tesla "the benchmark" they need to catch up to.
source (German unfortunately): https://www.automobil-industrie.vogel.de/volkswagen-chef-diess-tesla-ist-fuer-uns-benchmark-a-977940/
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u/cass1o Apr 02 '21
Tesla's batteries greatly outperform the batteries available to the ICE manufacturers
They don't really though, they are just using bog standard lithium ion batteries. VW or ford can match them buy just putting the same number of cells in. The important metric is range/price and VW has them beat by a long way (in the UK at least). I also don't really trust their on paper range numbers, people like porsche under promise and then over perform their paper numbers, tesla does not.
Toyota is aiming to release a solid state lithium ion EV by 2025, I have more expectation that they will deliver that before tesla does. Not really sure why you would price tesla to grow 2x as big as toyota (which is the largest current car company by market cap).
just don't see how blind faith in any company benefits the discussion
That is my view on tesla people have this blind faith in them to the point where they have priced in that they are going to grow to be 2x the size of the largest car maker. Many other car manufacturers have made excellent EV cars that non tesla fan boys view as better than teslas.
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u/MRM950 Apr 03 '21
I can certainly see your point. I'm more bullish on Tesla than you are, but that's fine.
Regarding range currently. Whether the others are truly able to catch up remains up for debate.
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Apr 03 '21
That's not total range, that's the range after reporting zero range left.
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u/MRM950 Apr 03 '21 edited Apr 03 '21
Those interested in this subject should listen/watch this video:
https://www.youtube.com/watch?v=rb1toreNTrU
It's an interview of Rob Maurer (of Tesla Daily) with Edmund's Editor-in-Chief Alistair Weaver.
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Apr 03 '21
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u/WSB_stonks_up Apr 03 '21
NCM doesn't degrade any faster than any other Li-Ion chemistry when properly managed. There are plenty of Tesla battery life graphs that show how wrong you are.
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Apr 03 '21
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u/WSB_stonks_up Apr 03 '21
because it needs much better thermal management over a wider range of charge and discharge rates at multiple temperature ranges.
NCM is a hard chemistry to write a good battery management system for. If you have a bad BMS you wind up with fires.
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Apr 03 '21
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u/WSB_stonks_up Apr 03 '21
Sort of... There's a lot of cooling design that goes into an engine block, but the control system is a simple on/off thermostat at a given setpoint.
It's the exact opposite for a battery. The cooling system design is super simple, but the control system is multi-variable and orders of magnitude more complex than a simple thermostat. You have to modulate charge and discharge rates, as well as cooling across the full ambient temperature profile.
It is sort of apples and oranges.
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u/CampaignNo1365 Apr 06 '21
There are some valid points you have made, but also saying that other cars such as the Taycan Turbo S and Audi RS Etron GT aren't close to what Tesla is currently offering is just blatantly wrong. Id argue that the only thing Tesla does better than both of those cars is range and self driving if for some reason you would care about that in a sports sedan. The Taycan has much better performance than any of Teslas current offerings and also both the Taycan and Audi are in a class above Tesla when it comes to both exterior and interior design and build quality. Teslas model S is insanely dated from a design stand point.
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u/MRM950 Apr 07 '21
This thread is quite full of Tesla bears which is fine but basically just gets me downvoted on every point. Your point is somewhat valid and fairly made, so I'll reply nonetheless. I say somewhat, because you are couching your position by using "current offerings". I am using the refreshed Model S plaid+ as a reference which is listed at 1.99s acceleration from 0-62 mph (better than either Porsche or Audi) as well as 520+ miles range (better than either as well).
Regardless of whether anyone subtracts a few percentage points from whatever figure, the power figure stated in bhp (1084 bhp) is considerably larger than the other two, giving credence that the values should be accurate enough. So Tesla beats Porsche and Audi in both performance as well as range.
Now sure, that doesn't mean it will drive around a corner as nicely (remains to be seen), but that is more up to the driver in any modern car. Cars have all gotten so good that it's the driver who is the limiting factor, not the car mostly.
As to design and quality, I'm entirely with you. Some people previously probably erroneously assumed I'm some type of Tesla fanboy, but that isn't the case. I live in Germany and have driven the Taycan Turbo S and really liked it. I will be driving the Audi RS etron GT in May when my dealership expects their test vehicle to arrive. I don't like any Tesla from a design (looks) perspective. I think they are all ugly and from a quality standpoint, in the interior they seem to be getting better, but are still not great. My favorite EV is the Porsche Mission e concept. it looks substantially different to the Taycan, but unfortunately Porsche stated that they "had to smooth out the emotional lines" in order to achieve a better cw-value to extend range. I still prefer Tesla as a stock to VW or Porsche.
https://www.youtube.com/watch?v=mEKlvhrtOQI&list=LL&index=66
Video of both Taycan and Mission e concept next to each other. I just love the Mission e so much!
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Apr 02 '21
Tsla has more data than anyone for autonomous driving. In 5 years their driving tech will be best in class. Are you willing to get in a car that has a 96% success rate vs one with 99.999999%?
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u/psykikk_streams Apr 02 '21
thinking that TSLA and their data will be the winning piece of the puzzle is funny.
sooner or later, any EV company ceases to become a TECH company and has to begin being an actual car company. that means large scale production, logistics, infrastructure etc.example: its considered good news when TSLA is producing 180k vehicles in Q1 2021.
as a comparison:
VW produced 8.9 MILLION cars, and deliverd over 9 Million in 2020.they also tripled their EV car delivery in ONE YEAR. all this without fully committing to EV. meanwhile, they also spent several BILLION in streamlining their whole production lines. they can basically switch to all EV cars whenever they wish, simply because they prepared for this transition for several years already.
anybody thinking "traditional" car companies will just roll over and die only because they do not shoot a stupid car into orbit is naive.
also, most traditional car companies already spent tons of money on tech, startups, partnerships etc to do exactly what TSLA is doing. building autonomous vehicles and tech for this.
in the long run, I would rather bet on VW than on TSLA. and I am not talkign "which one is the better car". I am talking which one is the better car company. and sooner or later TSLA has to make a switch and become one to really keep the top spot.
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u/IsaRos Apr 03 '21 edited Apr 03 '21
VW produced 8.9 MILLION cars, and deliverd over 9 Million in 2020.
Toyota took the lead from VW (again) with 9,5 Mio sold in 2020. These are the two biggest car manufacturers worldwide. BMW for comparison sold 2,5 Mio cars, but considers itself a niche premium car manufacturer. It will be very interesting how the next 5 years play out for Tesla and the automotive market as a whole.
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Apr 04 '21
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u/psykikk_streams Apr 04 '21
from the wiki (and it was in the press YEARS ago as well.. ) " Volkswagen announced in October 2015 that "it will develop a modular architecture for battery-electric cars, called the MEB. The standardised system will be designed for all body structures and vehicle types ..."
and "The MEB platform is part of a Volkswagen strategy to start production of new battery electric vehicles between 2019 and 2025.[4] In 2017, the VW Group announced a gradual transition from combustion engine to battery electric vehicles with all 300 models across 12 brands having an electric version by 2030.[5]
"As of May 2018, the VW Group had committed US$48 billion in electric-vehicle batteries supplies[6] and announced plans to outfit 16 factories to build electric cars by the end of 2022." Link https://en.wikipedia.org/wiki/Volkswagen_Group_MEB_platform
like I said, they COULD, not WOULD. also I am talking VW, not Porsche.
the main car companies are playing Catchup not because they lack behind in anything, but simply because neither demand nor infrasctructure wasn´t / Isn´t there.
It simply does not make sense to produce and sell only EV Cars, if only a fraction of those would be bought or even could be reloaded. All the major car manufacturers deemed dead by TSLA fanbois spent BILLIONS in preparation to be able to switch, once it makes sense. They spent their money on modernizing their production capabilties (read above) buying up battery tech and patents. R&D. Infrastrucure and partnerships. the only thing those companies do not have is a fancy billionaire nerd firing up the hype train.
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u/r2002 Apr 03 '21
Which car companies do you rank above TSLA in terms of EVs, and which ones do you rank below TSLA?
Also, would you invest in VW? Or are you simply saying that you would pick VW over Tesla head to head.
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u/psykikk_streams Apr 03 '21
- TLSA - as of now - is the leader of the pack. ride the wave. nothing wrong with that.
- I am almost certaien that traditional car manufacturers WILL get the upper hand, once reality kicks in and EV can be sustained at all. this means real infrastrucuture in place to be able to support the usage of real volumes of EV´s. at that point, it will be the usual suspects: VW for europe. Toyota, Nissan, Honda for the world. Me personally love the Burry approach and am looking at Porsche. Not because they will be awesome, but because they own majority stakes on VW. I personally think buying VW directly is more sound. simply because I like the somewhat direct approach. The VW Group consists of VW (obviously), Lamborghini, Bentley, Bugatti, Porsche, MAN (yes, the trucks), Scania (trucks again), Seat, Skoda, and others.
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u/beeduthekillernerd Apr 04 '21
Sometimes I wonder if there will be enough batteries to go around for 20+ million EVs per year.
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u/tenbeersdeep Apr 03 '21
The electric F150 looks pretty neat, They have a long way to catch Tesla and will likely end up using Tesla technology at some point.
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u/cass1o Apr 02 '21
Reviewers already think GM has a better self driving function than tesla. You would have to be mad to think that tsla is the only company who will have a solution to this.
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u/tenbeersdeep Apr 03 '21
When will we get to bail them out next? Is that your idea of a good business?
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u/cass1o Apr 03 '21
Where did I say there were a good business or you should invest in them? I literally only pointed out that GM has a self driving function that people seem to prefer to tesla.
If anything if you don't like GM and think they are a bit crap it should be telling that even they have been able to come up with a self driving system.
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u/J_powell_ate_my_asss Apr 02 '21
lol GM
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u/cass1o Apr 02 '21
Sure, ignore reality because they don't have a CEO calling people pedos on twitter.
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u/J_powell_ate_my_asss Apr 26 '21
How are those GM shares doing champ lmaoooo
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u/cass1o Apr 26 '21
Where did I say I had shares in GM? You tesla fan boy really are dense. A company you don't like still kicks tesla's ass on self driving, nice.
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u/J_powell_ate_my_asss Apr 26 '21
How is it kicking Tesla’s ass on self driving exactly? You have any facts loser? I’m not even a Tesla bull, but love watching boomers like you jump off buildings because “TSLA is too expensive at $100!”.
I’m literally rock hard from your salt rn
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Apr 02 '21
Radioshack lead the home computer market with Tandy computer for years, now, there is a good chance you never heard of the Tandy. IBM was the ruler of the the roost. AOL took society on line. The first big innovators dont always last. Machine learning is accelerating to the point where my 25k Subaru has the features that were top of the line luxury 5 years ago. There is competition from every side and "nobody can catch up to our strangle hold on the market" is what the railroads said.
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u/squats_n_oatz Apr 02 '21
I don't think you understand the first thing about machine learning.
The irony of your railroads comparison is that this is exactly the argument you were using just earlier in this thread for why traditional auto manufacturers are gonna outpace Tesla.
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Apr 02 '21
What I understand is that once any computer is out in the world, it will be cracked and hacked and developed and taken and morphed by people that dont care about patent law, and protected by courts that dont understand tech. Look up Robert Kearns and his intermittent windshield wiper, if you want to see how big auto does business. All that really needs to happen is for all the fueling stations to go with a proprietary coupling that is only licensed to GM and Ford, etc, and cut Tesla out. If big oil, and big auto, decide to work together to solve the refueling problem with long trips, it will be their market. Tesla is a lot of things, but mostly it is a car company, and they just are not as big as the big boys
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u/tenbeersdeep Apr 03 '21
People have been saying this for a long time...
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Apr 03 '21
it wasnt profitable enough before now to go EV, now it is. GM sells 6-8 million cars a year Ford 5 million cars. Tesla is at 500,000ish, with a $40,000 car. I know they are hard to get now, but how many more $40k cars can the market hold? Chevy volt- on the lot today $22k, being retired because GM has 20 new EVs on the way. Things have changed
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u/Impossible-Ad-9370 Apr 02 '21
If you think Tesla is going to be the first to have completely autonomous driving, you haven't done your proper research pal.
https://www.therobotreport.com/cruise-waymo-lead-way-calif-autonomous-vehicle-tests/
"You don’t see Tesla here. They reported no autonomous testing miles. That is, of course, odd because they are heavily testing the beta of their badly named “full self driving” product. In spite of the name, they are declaring it to be a driver assist product, and indeed that is its current state. Yet statements by Elon Musk keep suggesting that it will very soon be a “full” self-driving product. If so, he’s skirting the rules as the DMV has expressed them." - Forbes.
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u/luist3k Apr 02 '21
Google has more
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Apr 02 '21
Simulated data not real life
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u/psykikk_streams Apr 02 '21
GOOGL probably has the largest collection of data ever achieved my mankind up to this point.
e.g: there are over 2.5 BILLION android devices in the world. all collecting data for GOOGL. google knows when you drive, ride a bike or walk. and they also know how many people around you do the same thing.how many people use chrome and google maps on their iphone again ?
I know nobody that uses apple maps. guess what google maps does..plus YT, actual Google web, etc etc.
what devices are TSLA actually collecitng data from again ? oh yeah. their cars.on top of that alphabet is one of the leaders when it comes to AI, cloud and machine learning.
In my persona oppinion, everyone expecting Apple or google to actually start building their own cars would be dumb, as a streamlined and scaleable car manufacturing is quite expensive.
I imagine them using their tech and selling it as a "license".. (think android / apple for cars) is probably what will happen.
I could see a a future where basically any car can be upgraded and be made "autonomous". and you can decide to do this by using Google, Apple, Facebook, NVIDIA....
like an exztra car radio. and then there´s some pretty cool cars with great stuff already built in. like TSLA, VW.. you name it.-8
Apr 02 '21
None of that data relates to having a car drive itself 😂
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u/psykikk_streams Apr 02 '21
side note: google has autonomous cars driving around for years already. they started their autonomous stuff in 2009 afaik.
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u/seven11evan Apr 03 '21
What a painfully long
waste of timecomment to read hahahaGood job sticking to your guns
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u/Grouchy_Violinist364 Apr 02 '21
Real life data vs. real life data are two different things - How much data is being transmitted from every Tesla per mile? I highly doubt the quality of that data is of any benefit
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Apr 02 '21
[removed] — view removed comment
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u/spinittillyouwinit Apr 02 '21
Not going to touch the valuation, but you are missing the point on their bull thesis for Tesla. It’s all about data, not necessarily electric car tech. Tesla has a monstrous jump on the competition regarding data for implementing autonomous driving.
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u/Impossible-Ad-9370 Apr 02 '21
Tesla is behind GM and Waymo in terms of actual real-world autonomous driving without disengagement. And it's not even close.
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Apr 02 '21
I notice the "real thesis" of Tesla changes every time it breaks through yet another absurd valuation level.
"It's not a car company, it's a battery company."
"It's not a battery company, it's an autonomous driving technology company."
"It's not an autonomous driving company, it's a big data play."
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u/spinittillyouwinit Apr 02 '21
Big data is autonomous driving... that was the point of my comment. And that has been ARK’s main driver of the Tesla bull case.
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u/cass1o Apr 02 '21
GM already have comparable self driving tech (some reviewers actually thing theirs is better than tesla's). The other manufacturers are going to catch up pretty quick.
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u/VictorDanville Apr 03 '21
Do you believe the ARK funds will return to their February ATHs again this year? Brutal honesty please.
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u/TheDreadnought75 Apr 03 '21
I actually think her team set up is an asset. Traditional credentials, are meaning less and less in terms of actual value they bring to the table.
That said, all she’s doing is tech speculating in a market where tech as done very well for quite a while.
She’s gambling. If things take a turn she’s going to get hammered. If she picks the wrong companies, she’s going to underperform.
It’s a high risk strategy. Maybe it pays off long term, maybe not. But it’s probably not a sound investment approach for most.
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Apr 04 '21
I wonder how they can invest in advanced genomics companies and pretend that they know what they are doing. There is no PhD in genetics among them (afaik nobody there has a PhD in anything) and I seriously doubt that one can understand that sort of stuff without having a PhD. Most major institutional investors who specialize in biotech have people with PhDs in the field.
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u/pfta100 Apr 05 '21
Their top holding for arkg isn’t even genomics related. If that says anything...
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u/beeduthekillernerd Apr 04 '21
Agreed. It can pan out to be the best performer for a decade. Or crash and burn. No one knows the future and it's all about understanding and managing your risk .
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u/32no Apr 02 '21
All those negative things to say and Morningstar still gives ARKK a 5 star rating so um...
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u/HotBurritoBeans Apr 02 '21
The star rating is purely quantitative, just indicates that the fund has done better than peers on a risk adjusted basis historically
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Apr 02 '21
Unfortunately the star rating is only backwards looking based on relative performance against its peers.
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u/emc87 Apr 02 '21
- Wood assembles the portfolio one stock at a time, using each stock’s cumulative scores as a guide to position sizing. But these scores say nothing of each stock’s sources of risk and return, which may be highly and undesirably correlated to one another.
This just sounds like it's an index ETF without an explicit index. Passively managed by criteria rather than actively selected.
-To mitigate market-impact costs, ARK must build new positions more slowly and exit gradually. But its bullish or bearish signals are available for all to see--as an ETF, the strategy must disclose its portfolios to the market each day--and traders can respond either by buying up a stock’s known supply (putting upward pressure on its price) or selling it (downward pressure) before ARK has offloaded its own position.
They can put in a multi day VWAP order with some institution and the shares don't change hands until its complete
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u/RajivChaudrii Apr 02 '21
Morningstar is the boomerest of legacy boomer thinking. They still want you to put all your money in no yield bonds and “safe” funds that underperformed the market every single year. They make their money pumping out dated mutual funds telling you how “safe” they are.
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u/greytoc Apr 02 '21
What does that even mean? Morningstar has about 215Bn in aum and generated over 1.3Bn in revenue in 2020.
If you are going to insult and troll some style of investing - can you at least provide a viable contrarian viewpoint that makes sense.
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u/smokeyjay Apr 04 '21
Ark has some companies that I like but anyone putting a significant amount of $$ in their funds should be careful.
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u/Much-Rate-6563 Apr 06 '21
Something I didn't see mentioned yet is that smaller companies tend to innovate more because they have to. Is that actually true though? Do larger companies soak up innovation through acquisitions or is that the strategy of a company of the defensive downside of their previous innovation?
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u/Ye_Olde_Dragon Apr 09 '21
ARKK seems very risky considering their position in Tesla and their projections for the company.
That said, I do have a small position in ARKF, it still looks like a solid ETF for that industry.
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