Four months have passed since the start of 2023, and really nothing has changed. “Investors” still cling and keep buying more of their old darlings from before the bear market, as the list of most frequently traded shares is still headlined by Tesla, Alphabet/Google, Apple, Microsoft, Amazon, Nvidia, Alibaba, Nio, Bank of America, etc. All in the old expectation that what once was great will be great again. Las Vegas at its finest.
These stocks are on average 41% off their previous price Highs, and AAPL is the standout Big Tech “Safe Bet”, by now more crowded than a free beer party. Some of those stocks are off Highs as much as 87%. Buying a stock that is down that much on whatever reason that people nowadays use to rationalize “buying the dip” is nothing but a gamble. Sure, the stock might come back, like a neighbor on vacation. And some do, so gamblers can justify continuing to do what they’ve been doing all along. But it might also continue to decline to 50%, 80% or 90%, as many of the old tech bets from 2000, or 2020 for that matter, have done. You only need to ride one of these down, and any profits from other stocks are smoke. The roulette wheel takes bets both on red and black colors.
To top off, there is really no new merchandise. Any new strong market is always driven by a large wave of novel growth stocks leading the way. There is no such thing in sight.
Gambling is an expensive hobby. Speculate when the odds are in your favor, or spend your time doing something else.
