Cathie Wood snapped up more of Block Inc. shares as the payment firm became short seller Hindenburg Research’s latest target on allegations of facilitating fraudsters.Three exchange traded funds backed by Wood’s firm Ark Investment Management LLC bought slightly more than 338,000 shares of Block on Thursday, according to Ark’s daily trading data. The purchases, valued at about $21 million based on Block’s latest closing price, came as Hindenburg’s report fueled a 15% plunge in the firm’s US-listed shares, the biggest drop since May 2022.
Hindenburg, whose call on Adani Group wiped out more than $150 billion off the Indian conglomerate’s market value at one point, alleged that Block facilitated scammers who took advantage of government stimulus programs during the pandemic. While analysts said many of the report’s claims were previously known and Block vowed to fight back, the stock tumbled as much as 21% in Sydney on Friday.
Block said in a statement that it intends to work with the Securities and Exchange Commission and consider legal action against Hindenburg for a misleading report on its cash app business.
ARK Innovation ETF, ARK Next Generation Internet ETF and Ark Fintech Innovation ETF made the purchases on Thursday. Ark is among the top 10 holders of Block’s shares, according to data compiled by Bloomberg.
Compared to last year, Ark is having a better time in 2023 as bets on the Federal Reserve’s tightening recede. Its flagship fund has surged 21% so far after plunging by a record 67% last year. The daily trading updates from Ark show only active decisions by the management team and do not include creation or redemption activity caused by investor flows.