Diversify your portfolio and don’t solely focus on tech, as it is a short-term mindset, advises fund manager Freddie Lait.
Many of the largest tech companies have seen surges in their stock prices recently, with Meta, Microsoft, Amazon, and Alphabet all posting record gains. However, according to fund manager Freddie Lait of Latitude Investment Management, investing solely in tech is a short-term approach, CNBC reports.
Short-term outlook for tech
Lait believes that a bull market will emerge, expanding to other sectors that offer better value than tech. Tech companies performed well during the years of low interest rates and experienced a boost during the pandemic. However, the question is how long this trend will last in the long run, with Lait describing the development of tech as “very short-term.”
Relying solely on the tech sector is therefore entirely wrong and “very risky,” according to Lait. He suggests that investors should look towards Dow Jones industrial stocks and “stocks in the old economy.”
Turn to the broader market
“There are plenty of opportunities out there in the broader market – other companies that are growing at similar rates to tech stocks but are trading at half or a third of the valuation, giving you more diversification and exposure.”