Mitch Goldberg, president of Melville, New York-based investment advisory firm ClientFirst Strategy, said the FANG stocks have cleared hurdle after hurdle, but that doesn’t mean investors shouldn’t cut back and rebalance according to their risk tolerance. “Better for you to do it before the tech sector does it for you,” he said.
Goldberg has been been scaling back on tech and adding to individual stocks in staples, big pharma, industrials and financials, which was the most popular sector in the E-Trade survey, with 56 percent of millionaires saying it offered the most potential. “Nothing in this market is actually cheap. Low valuations only exist relative to other sectors when you’re far into a bull market,” he said.
Goldberg said any millionaire investor is also an “experienced” investor, but what they are able to see in the market is available to all. “FAANG, fintech and cloud stocks are up huge this year. They’ve been carrying water for the whole stock market for a long time now. Yes, energy is having a good year, but that sector is only a small part of the overall S&P 500. What makes the FANG stocks worth so much more in just the last few months is a question worth asking.”