The three funds of Cathie Wood ARK Invest—ARKF(Fintech Innovation ETF), ARKK(ARK Innovation ETF), and ARKW(Next Generation Internet ETF*)—purchased $246 million worth of Coinbase Global Inc shares on Wednesday. The news made headlines mainly because they also sold the shares of Tesla after just under a month of talking up the carmaker.

Karim Moussalem, head of cash equity sales at Cantor Fitzgerald Europe in London, was shocked by Ark's decision to sell Tesla's stocks and labeled their actions as a bit odd.

But for many, ARK's bet on Coinbase comes as no surprise as Wood has been a keen advocate for Bitcoin; and ARK's ARKW owns a 5.7% position in the Grayscale Bitcoin Trust.

On 14th April, ARKF, ARKK, and ARKW bought 89,589, 512,535, and 147,081 Coinbase's stocks. And ARKK and ARKW sold 185,712 and 57,043 shares of Tesla, respectively. Cathie Wood backed her decision saying, "There are going to be great opportunities from now and five years to buy (Coinbase) on dips," while speaking to Bloomberg.

Wood contradicted her statement in March about predicting Tesla's price to rise to $3,000 by 2025 above its current $732 per share by selling its share untimely. Ark sold $178 million worth of Tesla's stocks on Wednesday, but Tesla remains their biggest acquisition on Ark's various funds.

Coinbase shares rose 11% up in U.S. premarket trading on Thursday, giving it a market cap of close to $100 billion. This purchase and risk-taking action on Coinbase gives Ark more indirect exposure to cryptocurrencies on top of their big bets on the likes of Tesla recently said would accept bitcoin as a payment module.

Cathie Wood increased the acquisitions of Coinbase furthermore on 15th April with ARKF, ARKK, and ARKW acquiring 33,092, 282,894, and 25,200 shares, respectively.

The decision to sell Tesla shares has astounded many. Some even went further questioning the decision and thinking of Cathie Wood on social media, but those who follow ARK closely know that they have a working system put in place, a rule to be precise.

If any company surpasses a weight of more than10%, then Ark is liable to sell the shares of that particular company to balance the weight policy.

For example, this table shows the holding of ARKK's Tesla shares taken from their website, as from the table below, you can notice that the weight of Tesla is over 10%, meaning in the future, one can expect further sales of Tesla shares.

The same goes for ARKW; the data below taken from their website show the total holdings of Tesla Inc. The data show that Tesla has a weight of over 10%, which means that more shares are expected to be sold to bring down Tesla down to 10% in the future.