Cathie Wood, founder of ARK, connected live with Li Yimei, general manager of Huaxia Fund, this morning to discuss the future of investment in disruptive innovation. Ms Mu mentioned her views on innovative technologies such as ARK flagship funds, electric cars and mobile payments.

Referring to her fund, Mu said that ARK conducts cross-industry research, which is different from that of ordinary funds, investing in five years and pursuing 20 to 80 per cent growth in the next five years.

During the five-year study, focusing on linear growth, ARK research is influenced by innovation, business development teams work together to select appropriate investment opportunities, and examine how low costs and low prices lead to increased demand.

The fund focuses on the investment range of five years, and the growth during the period will be surprising, with a compound growth rate of 15%. Although the fund is under pressure in the short term, it is confident that the fund will get a very satisfactory return after five years. The annualized return of the flagship fund over the next five years is expected to reach 15% to 25%.

In the face of the sharp decline some time ago, she said that the fluctuations in the past six weeks were mainly due to the vigorous recovery of the Chinese and US economies and the 40-year bull market in the US bond market, and investors began to worry about losses in the bond market, and the most important factor was the worry about inflation. but expectations are short-lived, mainly caused by the economic downturn last year, and inflation is expected to rise to about 3% to 4% this year.

In terms of other innovative technologies, such as mobile payment, Mu mentioned that seeing the huge amount paid by WeChat Pay and Alipay in 2017 was an eye-opener. Innovative technology has greatly reduced costs, and more consumers have access to technology, while technology has an impact on different industries, and the shares covered by innovative platforms are also increasing. For example, the annual cost of DNA arrangement has dropped by 40%.

Electric cars are expected to gradually expand to the mass market. Thanks to lower costs, the price of electric cars is expected to be lower than that of conventional fuel-fired cars within 1.5 to 2 years. In the next five years, electric vehicle sales will grow at a compound annual rate of 82%. Tesla, Inc. is mass-producing electric car batteries, which is a super growth trend, thanks to technological innovation that has led to a sharp drop in battery costs.

Li Yimei, general manager of Huaxia Fund Management, also mentioned some of the themes related to innovative technology, such as electric cars, which made very high returns last year, which is not a short-term trend. China is facing the problem of energy shortage, carbon neutralization is one of the key policies, the development of electric vehicles is in line with national security issues, China wants to develop the entire electric vehicle industry chain, so it will be a long-term trend.

Sister Mu also agreed, saying that the development of innovation and technology is the key development direction of China, and that the mainland lags behind in the development of DNA, but it has changed because competition has led to a sharp drop in costs after the opening of the market. When they first came to China in 1994, local enterprises hired a large number of employees without machine help, but now the situation has changed greatly.