Key insights
- The user expresses concern that S&P 500 and all-world ETFs are becoming too risky due to high valuations and concentration in tech/semiconductor stocks. This suggests a potential bearish sentiment towards broad market ETFs, implying that investors might be overpaying for current market leadership, which could lead to underperformance if these sectors correct.
Hello everyone,
As the title suggests, I’m wondering whether S&P 500 or all-world ETFs are becoming riskier, perhaps even too risky, given the growing concentration in tech and semiconductor companies and their increasingly high valuations.
Under normal circumstances, I would prefer to allocate 70–80% of my portfolio to ETFs and keep the rest in individual stocks for fun. However, at the moment, some individual stocks seem undervalued to me, while many others appear significantly overvalued. Buying an all-world or S&P 500 ETF right now feels uncomfortable because it means I’m also paying for those elevated valuations (and yes, I’m looking at you, SpaceX).
What’s your take on this?