Over the past few months, Tesla A sharp rebound in TSLA shares has given the electric car maker its highest weighting ever in Cathie Wood's $6.2 billion flagship ETF.

Tesla now accounts for about 15.4% of the ARK Innovation ETF (ARKK.US), according to compiled data, after the company's stock price rebounded more than 80% from its 2024 low set in April. This is even after the fund reduced its holdings of Tesla shares in recent weeks.

This weighting is equivalent to the strongest conviction in the stock in the disruptive technology fund's 10-year history, according to an analysis by Strategas Securities. Tesla has long been one of Wood's highly bullish stocks, and in April this year, Tesla regained the top spot in ARKK, replacing Coinbase (COIN.US). The ETF's second largest holding is Roku (ROKU.US), with a weight of about 9.1%. Coinbase ranks third, accounting for about 8.5%.

“The run-up in the stock price is definitely a huge catalyst,” said Todd Sohn, ETF strategist at Strategas. “Usually they would keep the weighting capped at about 10% to 11%, but now they’re letting it run higher.”

The ARK Innovation ETF hasn’t bought Tesla shares in recent months and even sold them a few times in July, according to daily updates the firm sends to clients. The ETF is down about 12% this year, while Tesla is up about 5%.

As of Tuesday's close, the automaker's shares had risen for a 10th straight session, its longest winning streak since last June. The gains were fueled by quarterly shipments reported this month that beat analysts' average expectations.

The fund's parent, Ark Investment Management, did not immediately respond to a request for comment.

Wood has been one of Tesla's most loyal supporters, and she became famous for her bold predictions on Tesla's stock price at the height of the pandemic. Retail investors accepted her views and pushed the company's assets to a peak of more than $60 billion in early 2021.

Demand has since waned. Combined, Ark’s six actively managed ETFs now have about $11 billion in assets. This year, the funds have seen net outflows of $3.4 billion, led by $2 billion in outflows from ARKK.

Despite this, Wood's confidence in Tesla remains firm. In June, she updated her forecast for Tesla's stock price to $2,600 by 2029, or about $3,100 in a bull market scenario. As of Tuesday's close, Tesla's stock price was $262.33.

Of the 10 ETFs that hold Tesla at 10% or more of their portfolios, three are Wood's funds, including the $1.5 billion ARK Next Generation Internet ETF (ARKW.US) and the $839 million ARK Autonomous Technology & Robotics ETF (ARKQ.US).

Other funds include the $1.5 billion Fidelity MSCI Consumer Discretionary Index ETF (FDIS.US) and the $730 million First Trust NASDAQ Clean Edge Green Energy Index Fund (QCLN.US).

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