'At every corner, Elon Musk has looked at the car and made it better'

Investors should consider an innovation hedge in their portfolio as the pace of change accelerates, according to one of the stars of ARK Invest.

Tasha Keeney, an analyst at the New York City firm, is responsible for the firm’s autonomous technology and robotics strategy, covering autonomous cars, additive manufacturing, infrastructure development, and innovative materials.

The keynote speaker at yesterday’s Women in Wealth Management event took part in a Q&A discussion to kick off the day, reflecting on her 'inspiring' CEO Cathie Wood to what it was really like interviewing Elon Musk.

Wood has risen to be one of the world’s best portfolio managers in the world, with her belief in Tesla a large part of her success. Central to that has been the analysis led by Keeney, who praised her boss for her focus on the research behind the innovation. She said: “It's great to work for a woman-led firm and it’s certainly great for me to have someone above me that can serve as a role model."

Keeney believes the world is on the cusp of momentous change, with the first autonomous taxis set to made available to the public, with no one in the front seat. And there is Tesla itself, which has always been one of Ark’s top positions.

The analyst told WP that having shared some analysis on the company on Twitter, Elon Musk saw it and reached out. He was impressed, and Keeney and Wood were then able to get him on their podcast to learn more about his strategy.

“He’s a really fun person to talk to as you can imagine,” Keeney said. “He’s a really confident guy but you have to be because he's promising these things in the future that are impossible today, like a fully autonomous car. What makes him super interesting to talk to as a CEO is that he's an engineer, so he sits with the autopilot team on a weekly, if not daily, basis. He works on this and has put a lot of thought into it, so it was really exciting or me, as an analyst, to interview him and get into the weeds of how autonomy works.”

She added that a lot of separate moments came together to fuel Ark’s excitement about the company, including the realization that it’s the only auto company that’s collecting information from their customer vehicles on the road, which they can use to train their autonomous system.

“It’s an amazing company,” she said. “At every corner, Elon has looked at the car and re-engineered things and made them better. And in an industry that just squashes start-ups, it's a seemingly impossible problem to solve to break into the auto industry.”

While women are woefully represented in the technology and robotics field, Keeney said this means there is a tight-knit community that is happy to connect and mentor each other. Wood’s skill as a portfolio manager makes her an ideal role model but her analyst told WP it runs deeper than that.

Decisive, competent and a leader, Keeney compared Wood's approach to tennis star Serena Williams, who when asked whether she will go down as one of the greatest female athletes of all time, said: “I prefer … one of the greatest athletes of all time”.

Keeney said: “I feel like Kathy is really the same way. She wants us to be differentiated by the research that we do and that comes through us getting credit for all the blogs we write and being able to put our faces on TV.”

As well as autonomous cars, another big development on the horizon is small drones and using them to deliver packages or medical supplies to people all over the world. Testing has been done and the Federal Aviation Authority has started approving a lot of projects.

This could have a profound impact on how we deliver things, being more convenient, efficient and cheaper than mail. For medical issues, it could be a game-changer for some of the remotest parts of the world or those with poor infrastructure.

So, why should an investor integrate this type of innovation into a portfolio?

Keeney said: “There is a reason why Ark is primarily an active manager because we think being active in a time where things are changing more rapidly than they ever have before allows you to stay on top of these technologies.

“We have meetings every day, talking about all the latest developments that are happening in the technology fields we cover. We're able to act on that information quickly and then we also have a long-term time horizon – you have to look five years out to understand why an auto company today might invest in technology in the future.”

She added: “A lot of traditional auto probably won't be around in the future, auto insurers will probably have their premiums cut, because over time it’s probably going to be a lot safer. We think that if you're only exposed to the traditional indexes, you might have a lot of those traditional industries in your portfolio, and you might use the Ark strategies as an innovation hedge.”