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Why Robinhood Stock Rocketed 24% Today

By Rich Smith – Updated Aug 3, 2021 at 5:21PM

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Cathie Wood is a buyer -- and that sparked a buying frenzy today.

What happened

Shares of Robinhood Markets (HOOD 1.22%), the popular app-based, trade-by-phone stock brokerage, soared to close up 24.2% on Tuesday.

You can probably thank Cathie Wood for that.

Stock-up glowing green arrow climbs on a stock screen.

Image source: Getty Images.

So what

On the first couple of days since Robinhood made its market debut in an IPO hosted on its own app, ARK Funds' online tally of its trading activity showed that the several funds controlled by Wood had purchased a total of more than 3.1 million shares of Robinhood.  

Today, however, ARK disclosed that just one single fund -- the ARK Innovation ETF (ARKK 0.69%) -- now owns 4.9 million shares of Robinhood.  

Now what

Within the grand scheme of things, that's still not a lot. According to ARK Innovation's report, Robinhood shares still make up barely 0.8% of the total value of its holdings. That being said, it was presumably Investor's Business Daily and other publications' highlighting of ARK's interest that sparked a renewal of other investors' interest in the still unprofitable stock broker.

And thanks to today's surge, for the first time since its IPO, Robinhood stock is finally trading above its $38 IPO price.

Rich Smith has no position in any of the stocks mentioned. The Motley Fool has no position in any of the stocks mentioned. The Motley Fool has a disclosure policy.

Stocks Mentioned

Robinhood Markets Stock Quote
Robinhood Markets
HOOD
$9.99 (1.22%) $0.12
Ark ETF Trust - Ark Innovation ETF Stock Quote
Ark ETF Trust - Ark Innovation ETF
ARKK
$38.16 (0.69%) $0.26

*Average returns of all recommendations since inception. Cost basis and return based on previous market day close.

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