Calm the f*** down

“THE TECH WRECK STRETCHES INTO DAY TWO AS LARGE CAP TECHNOLOGY STOCKS….”

Okay stop. The stocks in question – software, chips, phones, networking, wireless equipment, whatever – these things are all $50 billion to $750 billion market caps. They’ve gone up between 20 and 70 percent this year. Literally, year-to-date.

You’re talking about a name like Apple, it goes up 30 percent in a straight line for almost six straight months and then declines 6 percent from that peak in a program-trading rotation.

Well? What exactly did you think would happen? Another 30 percent rally on top of 30 percent? You thought these were one-way trades?

Even LeBron gotta sit on the bench sometimes.

Meanwhile, the rest of the S&P 500 is awash in new all-time record highs – hotels, fast food, aerospace and defense, insurance, asset management, you name it.

And besides, take a step back and look at the last six months – here’s the quilt, dating back to just before the start of this year. You’d have to have been allergic to money to have missed out on this (click to embiggen):

The lightest green boxes represent stocks with gains north of 24 percent for the six month period. And there’s a ton of light green, in nearly every sector save for Basic Materials (‘member the Trump Trade? LOL).

Okay, so now what? Does the “tech wreck”, which so far looks like an ordinary rotation (albeit a quick one) end up dragging down the rest of the market? Or does the cash resulting from tech selling continue to boost the rest of the equity market?

Depending on your timeframe and strategy, getting this question right either means everything or nothing at all.

Know what kind of investor you are before coming into contact with just the latest bout of hysteria in an endless cycle of it.

And calm down.

This content, which contains security-related opinions and/or information, is provided for informational purposes only and should not be relied upon in any manner as professional advice, or an endorsement of any practices, products or services. There can be no guarantees or assurances that the views expressed here will be applicable for any particular facts or circumstances, and should not be relied upon in any manner. You should consult your own advisers as to legal, business, tax, and other related matters concerning any investment.

The commentary in this “post” (including any related blog, podcasts, videos, and social media) reflects the personal opinions, viewpoints, and analyses of the Ritholtz Wealth Management employees providing such comments, and should not be regarded the views of Ritholtz Wealth Management LLC. or its respective affiliates or as a description of advisory services provided by Ritholtz Wealth Management or performance returns of any Ritholtz Wealth Management Investments client.

References to any securities or digital assets, or performance data, are for illustrative purposes only and do not constitute an investment recommendation or offer to provide investment advisory services. Charts and graphs provided within are for informational purposes solely and should not be relied upon when making any investment decision. Past performance is not indicative of future results. The content speaks only as of the date indicated. Any projections, estimates, forecasts, targets, prospects, and/or opinions expressed in these materials are subject to change without notice and may differ or be contrary to opinions expressed by others.

Wealthcast Media, an affiliate of Ritholtz Wealth Management, receives payment from various entities for advertisements in affiliated podcasts, blogs and emails. Inclusion of such advertisements does not constitute or imply endorsement, sponsorship or recommendation thereof, or any affiliation therewith, by the Content Creator or by Ritholtz Wealth Management or any of its employees. Investments in securities involve the risk of loss. For additional advertisement disclaimers see here: https://www.ritholtzwealth.com/advertising-disclaimers

Please see disclosures here.

What's been said:

Discussions found on the web
  1. carpet cleaning borehamwood commented on Feb 01

    … [Trackback]

    […] Read More on that Topic: thereformedbroker.com/2017/06/12/calm-the-f-down/ […]

  2. Regression testing commented on Feb 07

    … [Trackback]

    […] Read More on that Topic: thereformedbroker.com/2017/06/12/calm-the-f-down/ […]