The global economy is in recession and recent stock market volatility is a sign investors believe that the Federal Reserve's plan to continue hiking interest rates is too aggressive, star stock picker Cathie Wood said in a webinar on Tuesday.

Wood, whose ARK Innovation ETF outperformed all other U.S. equity funds during the pandemic rally in 2020, said slowing economic growth will likely benefit the type of innovative companies that the fund invests in.

"There are a lot of indicators to us that we are in a bit of a bear market" because of the Fed's expected plan to increase rates by 50 basis points at its June and July meetings, Wood said. "The markets are speaking pretty loudly right now and seem to be calling into question the Fed's strategy."

The benchmark S&P 500 is down approximately 16% for the year to date, near the 20% decline that typically signifies a bear market.

At the same time, "innovative" companies are being subject to "incredible" shorting activity, Wood suggested, pushing stock prices lower.

"If we are right, then shorts will be forced to cover and we are certainly looking forward to that time," Wood said.

The $7.9 billion ARK Innovation Fund, which gained 2% in Tuesday trading, is down 57.6% for the year to date. Overall, the fund is now down nearly 75% from its record high in February 2021, and close to the low of $34.69 it touched in March 2020 at the start of the coronavirus pandemic.

The fund added a position in General Motors Co, largely due to signs it is "serious" about its move into electric vehicles, the company said during the webinar Tuesday. Tesla Inc remains its largest overall position.

Despite its losses, ARK Innovation continues to draw the interest of investors. The fund has received positive inflows on net over the last 4 weeks, including $455.7 million in net inflows the week that ended May 4, according to Lipper data.

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Citi CEO Jane Fraser speaks at the 2022 Milken Institute Global Conference in Beverly Hills, California, U.S., May 2, 2022. Photo: Reuters / MIKE BLAKE