ARK Innovation Fund, owned by wooden Sister Casey Wood (Cathie Wood), more than doubled during the outbreak. Now investors' interest in high-growth stocks has waned because of soaring inflation and rising interest rates, and the fund is expected to be at the bottom of all US mutual funds in 2022. So far this year, the fund has fallen about 67 per cent, more than twice as much as the s & p 500. According to Morningstar's Dec. 16 ranking, the company's collapse made it the worst performer of the 537 U. S. medium-sized growth funds, almost the lowest of all U. S. equity funds tracked by Morningstar.

The S & P 500 will record its biggest annual decline since the financial crisis, and few funds will survive 2022 unscathed. Equity portfolio managers have underperformed the benchmark index by 0.6% this year, with most underperforming the 19% decline in the s & p 500 so far this year and the nearly 22% decline in the Russell 2000 index.

Brian Jacobsen, senior investment strategist at Allspring Global Investments, said: "portfolio managers made mistakes on inflation this year, and you can also say that the Fed made mistakes on inflation."

Wood's fund ranks 3544 out of 3552 actively managed u.s. equity mutual funds tracked by Morningstar. By contrast, the worst performing fund this year is the Voya Russia fund, which has fallen 92 per cent so far this year.

Mr Wood's preferred high-growth companies have fared particularly badly this year as the Fed's rate hike pushed up bond yields and undermined the attractiveness of high-growth stocks. such as$Zoom Video Communications (ZM.US)$、$Tesla (TSLA.US)$和$Block Inc (SQ2.AU)$Share prices have fallen by more than 60% this year, while$Teladoc Health (TDOC.US)$和$Roku Inc (ROKU.US)$All fell by more than 70%. Overall, the fund's top 10 positions have fallen 30 per cent or more so far this year.

Ms Wood, who a year ago said deflation was the real risk to the market in the coming year, also seemed caught off guard by the persistence of inflation. In September, she called the Fed's rate hike a "mistake" and said in December that she thought the US economy would be in recession "throughout the year". Consumer prices soared to their highest level in 40 years in 2022.

Meanwhile, the 15 most actively managed equity mutual funds this year have focused on energy or commodities, benefiting from soaring prices of oil and other raw materials. Jingshun Energy Fund, which ranks first among all diversified funds in Morningstar's ranking in mid-December, has risen nearly 49 per cent so far this year. ETN, a big US oil company with three times leverage, leads all funds in the Morningstar rankings. The fund has risen 172 per cent so far this year.

Other funds that have soared in recent years by making big bets on technology stocks suffered tough times in 2022. For example, the $59 million Zevenbergen Genea fund plunged 59%, making it one of the worst-performing diversified funds this year, according to Morningstar. The fund, like ARK, has made big bets on Tesla, Inc..

Wood rose to fame in 2020 when her portfolio of so-called "home" stocks such as Zoom and Teladoc soared, helping her fund manage assets of $27.6 billion at one point. The fund currently has slightly less than $6.5 billion in assets.

Memories of those exciting days may be one of the reasons why many investors continue to believe in her vision for the future. Although total assets under management by ARK Innovation Fund have halved due to poor market performance, the fund has attracted net inflows of $1.6 billion this year, according to Lipper.

"the loyalty of investors to the fund is unusual," said Todd Rosenbluth, head of research at VettaFi, an analysis firm. This is still one of the largest actively managed ETF, and if it turns around in 2023, the fund will have lasting strength. "