'We're in for a reality check': Cathie Wood warned of the risk of a correction in the AI market

The artificial intelligence market could face a correction as monetary policy tightens, ARK Invest founder and CEO Cathie Wood has warned. Companies highly valued by investors will face a "reality check," she said. Wood is confident that the world is "only at the beginning of a technological revolution" and that there is no bubble in the market yet.

The artificial intelligence sector could face a "reality check" as central banks begin to move to raise interest rates, Cathie Wood warned in an interview with CNBC.

"There will come a point next year when the conversation shifts from lower interest rates to higher interest rates. Many people believe that innovation and interest rates are inversely related to each other, but that is not supported by history," she said.

"I want to rid people of that misconception," Wood continued. - But still, given the way algorithms work these days, let's just say we're in for a reality check."

As interest rates begin to rise, Wood said, markets will "shudder."

At the same time, she dismissed concerns that a bubble has already inflated in the artificial intelligence market. "A lot of people worry, 'Is it too fast, is it too soon?' But if our expectations for artificial intelligence, especially embodied - realized in physical form, in the form of robots and autonomous systems - are correct, we are only at the beginning of a technological revolution," Wood said.

Companies like AI developer Palantir, which are able to embed artificial intelligence into corporate processes and help businesses capitalize on productivity gains, will play an important role, she said.

Wood highlighted the potential for artificial intelligence to accelerate the creation of human-like robots. Machines that resemble humans in shape and movement, she believes, could be the biggest area of development for embodied AI.

She also highlighted the healthcare industry, where embodied artificial intelligence is "one of the most significant applications of AI" and will be a key driver of productivity growth and innovation in the coming years. Wood paid particular attention to multi-omic sequencing, a technology that integrates data from genomics, transcriptomics, epigenomics and other biological levels for more accurate diagnosis and personalized treatment. This segment she called "the most undervalued and misunderstood" among investment themes.

Wood cited energy storage and blockchain technology as other "net players" in innovation.

Cathie Wood is one of the influential investors involved in the debate about the future of artificial intelligence, especially after AI investments have led to record deals and asset revaluations.

Earlier this month, the International Monetary Fund and the Bank of England warned that global stock markets could face problems if investor interest in artificial intelligence begins to wane. IMF chief Kristalina Georgieva then gave investors straightforward advice: "Buckle up - uncertainty has become the new normal and will stay with us".

The ARK Artificial Intelligence & Robotics UCITS ETF managed by Wood holds the largest positions in Tesla (9.16%), Palantir (7.02%) and AMD (6.14%). According to CNBC, ARK's asset value is up more than 50% since the beginning of the year.

This article was AI-translated and verified by a human editor