So right now we have seen explosion in big tech and semis, AI adjacent stocks which have already ran up considerably. It seems like a no brainer crowded trade.
SMCI 20x, NVDA at almost 2 trillion market cap, other semis going to the moon. But how are expected future returns now?
Do you think other sectors such as fintech, growth, small caps, emerging markets etc, which have been left out will stand to benefit from lower interest rates? Given that investors would rotate and seek higher expected returns?(considering the overextended nature of the current big tech and semis rally)
Obviously the time to buy is before they run up (not after) or when they look unattractive (meta, pltr, 2022).
There was also a rotation of sorts in early 2022, when tech sector (including NVDA) crashed hard, and oil/energy stocks went up (but nobody wanted to touch them in 2021 because they’re ‘dinosaurs’ and ‘electric vehicles are the future’).
