Is The Bubble Going To Burst?  Everyone seems to think so.  If everyone keeps saying so then it certainly will seem that way in the short term while assets are shuffled.

For what it’s worth – and it means something – there is a lot of talk about 13F filings showing lots of selling in the previous quarter and overall for the year.  Many people see this news and think the selling is going to happen now but these filings are about past sales, sometimes months ago.  It is also very hard to correlate selling to expecting a drop in prices even if it appears many people with lots of money are selling.  These people spend lots of money and are going to sell when they feel they are getting a good deal.  It doesn’t mean they don’t believe in a company, the market, or see future doom.  Sell high is still one of the important rules of investing.

Watching pre-market trading now at 4am New York time and it doesn’t look good.  Many of the presumed bubble stocks are down 2-3 percent already in pre-market trading.  These include Nvidia, Apple, Google, Meta, and Microsoft.  This can lead to spooky markets, huge downs/ups (note – down then up), or then lots of selling.  I’ll say one thing – people will be talking about the market on Facebook (Meta), searching about it on Google and Microsoft and comparing charts and date on google sheets and excel, getting notifications on their iPhones (Apple), and most of those things in some way shape or form involve Nvidia chips.  Are these overvalued? Probably.  Can people live without these companies? No way!

My advice for possible dips across the market is to review your portfolio.  See where your largest holdings are by percentage and money amount.  Evaluate back 5 years to see your gains and loses per holding.  The market has been on a run for the past 1-3 years in part to covid time dropping many share prices before the run.  If you look at each position over 5 years you will likely see the ups and downs and have a good idea of what the ideal price should be if a straight line was showing.  Other things I look at over the years is if the company is making the same or more or less, the same profit or more or less, and if debt is going up or down.  PE is something I also view because some companies selling at 30-40 times their value is tough to chew on.