Cathie Wood says she's keeping an open mind on Chinese stocks despite dumping them during Beijing's crackdown

• Cathie Wood says she's keeping an open mind about some Chinese stocks despite Beijing's crackdown.
• Wood cut Ark Invest's exposure to China in July as the government targeted tech and education companies.
• But Wood said in a webinar there would likely still be interesting, innovative companies from China.

Cathie Wood has said she's keeping an open mind about some Chinese stocks, despite believing valuations could fall further after Beijing's crackdown on big companies.

Wood sold a lot of her holdings of Chinese stocks last month, as the government tightened its scrutiny of technology and education companies, stripping 8.2% off the value of China's main stock index over the month.

But Wood said in a webinar on Tuesday there were likely to still be interesting, innovative companies in China, Bloomberg reported.

"The valuation structure of [Chinese] companies is down and probably not going to come back very quickly," she said, adding that it may decline even more.

But Wood added: "I'm sure we're going to find some very interesting companies in the innovation space, and so we're going to keep an open mind there."

Read more: Inside Cathie Wood's China investing strategy: The Ark Invest CEO breaks down why she's selling out of Chinese stocks - and what she'll be buying instead with the cash raised

Wood's Ark Innovation Fund had around 8% of its $23 billion of assets invested in Chinese companies in February, but that had dropped to less than 0.2% as of August 9, according to Bloomberg analysis.

Beijing has cracked down hard on education companies, banning those that teach school material from making profits.

It has also intensified oversight of big technology firms. Beijing in July ordered app stores to remove Didi Chuxing, the country's biggest ride-hailing company just days after a blockbuster IPO in New York, causing the stock to fall as much as 25% in a day.

In a July webinar, Wood said regulatory crackdowns raise questions about whether Chinese companies can become major global players. But she said there would be some winners, with smaller competitors standing to benefit from the clampdown on larger companies.

Despite institutional investors going off Chinese stocks, retail investors have been snapping up companies as their share prices have plunged, with Didi and e-commerce giant Alibaba among the most-bought stocks on the TD Ameritrade platform in July.