Famed investor Cathie Wood, who heads up Ark Invest, deploys a strategy that focuses on the most disruptive and innovative businesses. Her firm's thinking is that these companies should exhibit huge growth over the long term as they create products and services that find broad adoption.

With this framework, it's not a surprise that (NASDAQ: TSLA) is the third-largest holding in the Ark Innovation ETF, which is Wood's flagship fund with over $9 billion in assets under management. Ark Invest is extremely bullish on the potential for electric vehicles (EV) and autonomous driving software.

But don't rush to buy this top EV stock -- which is down 49% from its peak -- just yet. You'll want to see improvements with this one thing before adding Tesla to your portfolio.

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Source Fool.com