Cathie Wood's Ark Invest has elevated SpaceX and Circle to among the ten largest positions in its flagship innovation fund. The firm also continued buying both companies after their second-quarter earnings reports, signaling sustained conviction in the two private firms.
Private companies in a public fund
SpaceX, Elon Musk's rocket and satellite company, and Circle, the issuer of the USDC stablecoin, are not publicly traded. That makes their presence in a widely held exchange-traded fund unusual. The ARK Innovation ETF (ARKK) typically holds stocks, but Ark Invest has carved out room for private securities through a special structure that allows it to invest in companies before they go public.
Both companies now rank among the fund's top 10 holdings by weight. Ark Invest has been a longtime backer of SpaceX, which has raised billions in private funding rounds. Circle, meanwhile, has drawn attention as the crypto market stabilizes and regulators eye stablecoin rules.
Continued buying after earnings
Ark Invest didn't stop at the initial allocation. The firm kept adding to its positions in both SpaceX and Circle after the companies reported their second-quarter earnings. That suggests Wood's team sees more upside ahead, even after the stocks—or rather, the private shares—have already climbed in value.
Because SpaceX and Circle are private, their valuations are set by the most recent funding round or by internal marks. Ark Invest discloses its estimated value for these holdings in its daily portfolio updates. The continued buying indicates that Ark believes the current valuation still leaves room for growth.
The moves give ARKK a heavier tilt toward private markets. That can boost returns if the companies eventually go public at higher valuations, but it also adds risk. Private shares are harder to sell quickly, and their prices are less transparent than those of public stocks.
For investors in the fund, the increased exposure to SpaceX and Circle means they're betting on Elon Musk's space ambitions and the future of digital dollars. Both are high-conviction bets for Wood, who has long argued that innovation will disrupt traditional industries.
The next catalyst for SpaceX could be a Starship test flight or a new funding round. For Circle, the timeline depends on U.S. stablecoin legislation and the adoption of USDC. Ark Invest will likely disclose any further changes in its daily trade notifications.
