Ark Invest Adds More Nano Dimension

Image via Nano Dimensions, Ltd.

Cathie Wood Still Likes Nano Dimension

As we noted in our previous post (Tesla Crashes In Fiery Wreck), there's been some overlap between stocks our system ranks highly and those purchased by Ark Investment Management founder Cathie Wood's ETFs. Tesla (TSLA) is one example of that. Nano Dimension (NNDM) was another. It was one of our top ten names on December 11th, as we noted in a post published a couple of weeks later (Big Gains From Small Names). By the end of last year, Ark Investment Management was the largest institutional holder of Nano Dimension.

On Monday, the Ark Autonomous Technology & Robotics ETF (ARKQ) purchased another half-million shares of Nano Dimension. 

Trade data via Ark Invest. 

Ark Of A Diver

As of Monday's close, Nano Dimension was up about 8% since it hit our top names in December, but it's had quite an arc - at one point it was up more than 171%. 

Chart

Since it had rocketed so high by January, we posted an updated hedge for it. 

What If You Owned NNDM Near Its Peak?

In January, we presented a way Nano Dimension shareholders could protect themselves in case their shares collapsed. Since then, shares of NNDM were down nearly 42% as of Monday's close.

Chart

Let's look at how the hedges ameliorated that drop and briefly discuss courses of action for hedged Nano Dimension longs now.

The January Optimal Collar Hedge

If you were looking to hedge Nano Dimension against a greater-than-30% decline over the next several months in January, it was too expensive to do so with put options. It was cost-effective to do so with an optimal collar though.

On January 13th, this was the optimal collar to hedge 10,000 shares of NNDM against a >30% decline by late August if you were willing to cap your possible upside at 60% over the same time frame.

Screen captures via the Portfolio Armor app on January 13th. 

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Disclaimer: The Portfolio Armor system is a potentially useful tool but like all tools, it is not designed to replace the services of a licensed financial advisor or your own independent ...

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