One of the key signals of a systemic mispricing of financial assets is concentration risk. I wrote about this in a number of posts on the blog, so no need repeating the obvious. Here is the latest fragment of evidence suggesting that we – the global financial markets and their investors – are at or near the top of froth when it comes to ‘irrational exuberance’: So what should investors do? Some lessons from the GFC that can help are summarized here: And some additional warning signs of the bubble are summarized here: Quote: “…our new Delirious Dozen consists of the FAANGs (Facebook, Apple, Amazon, Netflix and Google) plus seven additional high flyers (Tesla, NVIDIA, Salesforce, Alibaba, UnitedHealth, Home Depot and Broadcom).”
This post was published at True Economics on Sunday, November 26, 2017.