Investors don’t need to sweat about getting the timing right on the AI boom and overall stock market to win in this bull market. They can reap gains simply by holding an exchange-traded fund tracking the broader market, Ritholtz Wealth Management CEO and co-founder Josh Brown said Thursday on CNBC’s “Halftime Report.” “If you don’t understand technicals, I’ll make it very simple for you,” Brown said. “Nobody is down in [the Invesco S & P 500 Equal Weight ETF (RSP)] right now, and this trade represents the overall stock market.” He added, “You don’t have to get involved with all these different internal metrics and percentage of New York Stock Exchange stocks that are above whatever.” A broad-market play, especially an equal-weighted index offering exposure to a larger swath of the U.S. economy, can offer attractive returns at a time when investors’ confidence in artificial intelligence stocks’ abilities to sustain their sky-high valuations is faltering, sucking air out of the AI trade. The tech-heavy Nasdaq Composite retreated 0.5% on Thursday. Oracle led the pullback in AI and AI-linked stocks, falling 10% on the day. Other tech heavyweights such as Nvidia and Micron Technology shed about 2%. The S & P 500 fared better in Thursday’s session, trading at about flatline and within striking distance of its record high hit a day earlier. Still, the Invesco S & P 500 equal weight was up 0.8% as investors bought stocks smaller than the tech giants linked to the economy like Home Depot, Visa and JPMorgan. The S & P 500 is weighted by market cap, making it more linked to the big AI trade. The ‘RSP’ weighs Nvidia the same as Home Depot. “What that’s indicative of is that broadening out…if there’s too much controversy in an Oracle on any given day, or a Microsoft or whatever, there’s so many other games worth playing right now on the floor.” All opinions expressed by the CNBC Pro contributors are solely their opinions and do not reflect the opinions of CNBC, NBC UNIVERSAL, their parent company or affiliates, and may have been previously disseminated by them on television, radio, internet or another medium. THE ABOVE CONTENT IS SUBJECT TO OUR TERMS AND CONDITIONS AND PRIVACY POLICY. THIS CONTENT IS PROVIDED FOR INFORMATIONAL PURPOSES ONLY AND DOES NOT CONSITUTE FINANCIAL, INVESTMENT, TAX OR LEGAL ADVICE OR A RECOMMENDATION TO BUY ANY SECURITY OR OTHER FINANCIAL ASSET. THE CONTENT IS GENERAL IN NATURE AND DOES NOT REFLECT ANY INDIVIDUAL’S UNIQUE PERSONAL CIRCUMSTANCES. THE ABOVE CONTENT MIGHT NOT BE SUITABLE FOR YOUR PARTICULAR CIRCUMSTANCES. BEFORE MAKING ANY FINANCIAL DECISIONS, YOU SHOULD STRONGLY CONSIDER SEEKING ADVICE FROM YOUR OWN FINANCIAL OR INVESTMENT ADVISOR. INVESTING INVOLVES RISK. EXAMPLES OF ANALYSIS CONTAINED IN THIS ARTICLE ARE ONLY EXAMPLES. THE VIEWS AND OPINIONS EXPRESSED ARE THOSE OF THE CONTRIBUTORS AND DO NOT NECESSARILY REFLECT THE OFFICIAL POLICY OR POSITION OF RITHOLTZ WEALTH MANAGEMENT, LLC. JOSH BROWN IS THE CEO OF RITHOLTZ WEALTH MANAGEMENT AND MAY MAINTAIN A SECURITY POSITION IN THE SECURITIES DISCUSSED. ASSUMPTIONS MADE WITHIN THE ANALYSIS ARE NOT REFLECTIVE OF THE POSITION OF RITHOLTZ WEALTH MANAGEMENT, LLC” TO THE END OF OR OUR DISCLOSURE. Click here for the full disclaimer.
