The Thursday after NVDA reports earnings saw a big gap up, and a sharp reversal. If stocks can’t go up on good news, when can they go up? PLTR was another recent example with very good earnings, gap up open then a sharp decline.
AI does a decent job giving range of discounted cash flow DCF valuation. Used to be that it took a good deal of formal education, plus field training to get a half-decent DCF valuation estimate. For amateurs, this often involved guess work.
Like almost all AI results, be careful. Don’t ever go all in, based on any one indicator. During market crashes, DCF can be thrown out the window because underlying assumptions of future sales and earnings, can change radically if the broad economy is sinking.
Here are a few ETFs year-to-date:
SLV silver 72.0%
GLD gold 54.6%
EEM emerging mk 27.0%
QQQ Nasdaq 100 15.4%
SPY SP500 12.4%
IWM Russell2000 6.6%
TLT US20 yr 2.5%
My trading account +12.0%, so slightly behind SPY. Considering I have kept a large cash reserve all year, that’s an okay result.
Short term it will be difficult for the broad market and many leading stocks to make all time highs. META and TSLA have given up all their 2025 gains. AAPL, WMT are holding up well.
There is chatter about a K-shaped economy. The top 10 or 20 percent are doing well, and still doing discretionary spending. The lowest 25 percent is struggling, if not sinking.
Personally, I have a lot to be grateful for. As investors we all have a lot to be thankful for. About 40% of working Americans have near zero savings, many have significant debt. So if you have any money to invest, you are likely in the upper half.
