Cathie Wood tells Yahoo Finance Live that just like baby boomers have heavily influenced the stock market for decades, their children — aka millennials — will be equally if not more important to the investing landscape in the decades to come.
And that is one reason why the closely followed Ark Invest founder and CEO is staying long-term bullish on stocks.
"This is the echo of the baby boom," said Wood on the rise of millennial investors, notably in 2021. Wood referenced research that suggests the bull market in stocks may extend to 2038 as millennials build out their portfolios.
In many respects, it's these millennials with their increasing spending power that has created the meme- stock movement that began in January. It's a dynamic that has helped power the share prices of easy-to-understand, household name companies such as GameStop (GME), AMC (AMC) and BlackBerry (BB) to dizzying new heights.
By the same token, millennial interest in markets has arguably benefited the stock price of Wood favorite Tesla (TSLA) backed by well-known CEO Elon Musk (Wood has a $3,000 price target on Tesla). And in the process, this has made Wood's investment advice highly sought after.
Adds Wood, "I lived through the baby boom years, and that equity market move was magnificent. It was a very simple assumption, and it worked. And I do feel we are in the same place now."
To be sure, many of Wood's investments through her various ETFs have a millennial vibe as they are focused on companies leading in high-profile technologies.
For example, Wood owns shares of Robinhood (HOOD) and Coinbase (COIN) — two companies at the leading-edge of the rise in cryptocurrencies. The same could be said for Square (SQ), which is also morphing into a super app as it expands deeper into crypto. Roku (ROKU) is also a top holding for Wood, a play on millennials ditching their expensive TV bill for more affordable streaming services.
"So many people ask me, 'Are we in a bubble?' We couldn't be further from it. I do not believe that the average investor understands how productive these next five to 15 years are going to be [for stocks] as these S-curves feed one another and enter exponential growth trajectories that we have never seen before," Wood said.