The stock market has been on a wild ride in recent years, with talk of bubbles and market volatility dominating the conversation. Chas Craig, president of Meliora Capital, recently shared his insights on the current state of the market in his column titled “Stay invested for long-term success.”
Craig draws lessons from the dot-com bubble era of the late 1990s, emphasizing the importance of staying invested for the long term and avoiding market timing. He highlights the significance of the Magnificent 7 – Microsoft, Apple, Amazon, Nvidia, Alphabet, Meta, and Tesla – which have become a concentrated exposure in the S&P 500.
While these companies have seen varying fortunes in 2024, Craig believes that their valuation levels do not indicate a bubble that must burst. DataTrek Research has also provided insights on spotting speculative excess in the market, noting that key indicators of a bubble have not yet occurred.
Craig contrasts the Magnificent 7 with more speculative corners of the market, emphasizing the importance of real earnings and dominant market positions. In his next column, he plans to delve deeper into this contrast and explore the current state of the market.
As investors navigate the ups and downs of the stock market, Craig’s insights provide valuable perspective on the potential risks and opportunities that lie ahead. Stay tuned for more updates from Meliora Capital as the market continues to evolve.
