What To Do With Your Big Tech Stocks Right Now

No two ways about it: Higher rates and the "bond bogeyman" are here to stay. For how long? Could be a few months, maybe a few quarters. Or… maybe even a few years.

Rates are going higher because there's more money – trillions more – in the financial system, courtesy of the Fed. As the economy continues to climb out of the hole it was in, if only momentarily, and more of the country opens up, the "velocity" of money – the speed at which it moves through the system – will pick up. All of this points to higher rates and inflation.

In the long run, that recovery is good news… but it feels like cold comfort right now.

Bondholders are feeling the pain because as yields rise, prices fall. That simple but inescapable inverse relationship is rocking their world right now.

white robot near brown wall

Image Source: Unsplash

People who own stocks are feeling the pressure, too. The hard-charging, hell-for-leather Nasdaq Composite, which has been the undisputed market leader since 2009, is down more than 7% in just a month.

A lot of people are wondering whether their Big Tech shares, which have treated them beautifully over the past 12 uncertain, turbulent months, are about to nosedive. That's what I'm getting asked on national television.

I'll tell you what I tell them – plus some of what I can't…

How the Trend Is Changing

"Don't fight the trend" is a cliched old market adage for a good reason – it happens to be true. Very much so.

For months, the trend's been pretty good for us – pandemic stocks like online retail and biotech, personal tech like Zoom, going long on big bullish moves, and short on companies and sectors that couldn't adapt to the pandemic. The results speak for themselves – 15 Hyperdrive double- and triple-digit trading wins along since late 2020.

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Disclaimer: Any performance results described herein are not based on actual trading of securities but are instead based on a hypothetical trading account which entered and exited the suggested ...

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