The S&P 500 has outperformed Cathie Wood's ARKK since the March 2020 crash. This wild chart explains what's going on in markets.

At the start of last year, investors in star stock-picker Cathie Wood's Ark Innovation ETF were extremely happy. Between the coronavirus crash of March 2020 and February 2021, ARKK had soared roughly 300%.

But fast-forward 12 months, and holders aren't smiling quite so much. That's because a huge sell-off has hit the sort of speculative technology stocks that pack the exchange-traded fund, such as crypto exchange Coinbase. ARKK has fallen more than 20% this year so far.

In fact, since the bottom of the market in 2020, the S&P 500 has outperformed the Ark Innovation ETF.

The benchmark stock index rose 100% from March 23 that year to close of trading Thursday, according to Bloomberg data. That compares with a gain for ARKK of 98%.

It's a tortoise-and-the-hare story that explains what's been going on in markets over the last year.

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Flashy tech stocks soared in 2020 and for some of 2021, as central banks and governments slashed interest rates and pumped trillions of dollars into their economies.

That's because those companies were growing rapidly even while the economy was in the doldrums. Meanwhile, the appeal faded for investments such as bonds and shares of businesses whose performance is more sensitive to economic health.

But that's all changed over the last year, as economic growth and inflation have picked up. Central banks are planning to cut back on stimulus and raise interest rates, and that has sent bond yields soaring.

Higher interest rates make the far-off earnings of speculative tech stocks look a lot less attractive, seeing as "risk-free" returns on bonds are higher in the here and now. At the same time, growth and inflation have boosted the prospects of stocks in sectors such as energy and banking.

To be sure, March 23, 2020 is an arbitrary date. ARKK has beaten the S&P 500 quite dramatically, when its gains over the last five years are considered.

But its famous pandemic-era outperformance has faded. Perhaps there's a reason why Warren Buffett tells investors to simply buy the S&P 500.