The Ides of January 2025

Ben Carlson on Mega Cap World Domination:

 ... what’s an investor to do?

One could make a strong case in either direction:

Get the hell out of the mega cap tech stocks now! The valuations are too high and due for some mean reversion.

Or

Go all-in on mega cap tech because they are the only game in town. They will only get bigger and stronger in the years ahead when artificial intelligence rules the world.

Alas, I cannot predict the future.

To be honest, neither of these scenarios would come as a complete shock. I don’t know which path we will take. There are far too many unknowns to answer that question.

Human nature is both predictable and unpredictable.

My solution to this conundrum is as follows:

I own index funds and I diversify.

Index funds will own the winners without having to pick them in advance. And diversification gives you the optionality to own the winners that often come from unexpected places.

That’s not a black-and-white answer. I’m not going all-in or all-out on this one.

I prefer to invest in the gray area.

More >>> https://awealthofcommonsense.com/2025/01/mega-cap-world-domination/