00:00 Speaker A
The other thing I wanted to get your take on is the sort of, um, signs of froth in the market. Um, you know, as you know, there’s been a lot of talk about whether there’s been sort of over speculation here. What do you think?
00:13 Speaker B
Well, you know, we we have been discussing this with our uh clients. Um, you know, this year, but in particularly the last three three or four months because, you know, we is the story of the overly concentrated marketing seven stocks, you know, has been going on now for a a few years. And we have encouraged our clients to start diversifying going into other parts of the market because the the headlines that we normally get in terms of valuation and in terms of just index performance, they’re probably not representative of everything that is going on market-wise. So there’s a lot of cross currents under those circumstances, a lot of rotation that is happening. Uh the example that we provide is that, you know, even though the indices have experienced some volatility over the last couple of weeks, underneath the surface, we had seen quite a bit of, you know, momentum strategies going high and low very quickly just a week ago, you know, certain parts of the market, you know, underperform significantly. and when you look at areas like small cap, you know, there’s a significant amount of of low quality, you know, volatility going into those areas. So we we do think that these are signs that the market is getting into a place where, you know, uh investors are starting to just figure out that they need to start changing their strategy, not necessarily just going for the momentum trade. And the momentum trade is something that has worked, you know, for a long time now, but it’s also uh very risky to maintain that level of exposure to momentum.
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