Retail investors are all-in on stocks. So are the ultra wealthy.
The latest surge in capital is more than your neighbor’s teenager betting on meme stocks. A lot more.
Baby boomers are betting big that Wall Street is going to deliver on the promise of an easy, leisurely retirement.
High-net-worth individuals hold a staggering 65% of their assets in stocks. Not real estate. Not art. Not gold or foreign bank accounts. Just stocks. The same stocks everyone else wants to own:
The only time investors have had a higher allocation to stocks was during the 2021 meme stock mania. (Source: Bank of America Global Research)
The 65% read is just one percent shy of the peak set in 2021, during the meme stock mania, SPAC delusions and the most rampant gambling-like environment on Wall Street.
One strong driver: stocks at their peak “look” a lot more attractive than the declining purchasing power of the U.S. dollar and the rising costs at the gas pump and heating/cooling the home. (See: Crack-Up Boom.)
As Andrew noted for Grey Swan Trading Fraternity members this morning, the S&P 500 Index is now 6% above its 50-day moving average – the most “overbought” readings since the peak before the 2020 pandemic shock.
Speculators buy high to sell higher. That’s a risky proposition when everyone’s doing the same. Tread lightly in today’s market, take some profits off the table from your high-flyers now and focus on safer dividend-paying stocks.
You’ll be happy you did. If you’re looking for a recommendation on a safe place to stash your own pile, go pro, Grey Swan Pro. (See: Shadow Stocks.)
~ Addison
P.S. Last week’s Grey Swan Live! introduced Jeff Opdyke.
Jeff is a former Wall Street Journal writer who has moved not just to heavily invest overseas, but also to live overseas.
Today, Jeff’s trading and writing Global Intelligence Letter from his bolt hole in Portugal.
We got down and dirty with Mr. Opdyke on his strong views regarding life in the U.S. political and investing horizon between now and 2028.
His views have influenced his radical decision to move overseas and focus on investing outside a weaker U.S. dollar and a renewed emphasis on gold, silver, rare earths and energy investments to weather stormy skies ahead.
