Outside the Box
Managing risk and avoiding ‘volatility drag’ is absolutely critical to achieving long-term financial goals
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With the U.S. stock market priced for perfection and artificial-intelligence speculation driving a boom in tech-related stocks, many investors are asking if this is a stock-market bubble that could burst at any moment. Investors, especially those pursuing a “DIY” strategy, should approach their portfolio decisions with risk mitigation top of mind.
But calling something a bubble in itself distracts investors from rational decision-making. All bubbles eventually pop. The word conjures up visions of an inevitable market crash and triggers a highly emotional response. Investors would do well to avoid thinking about market risk in such emotional terms.
