Reported 4 months ago
Bank of America analysts studied 9 asset bubbles over the past century and found that volatility tends to increase as bubbles form, a trend seen in both the Great Depression and the 2021 ARK Innovation fund rally. Although current market indicators like the low VIX reading of 12.95 suggest it's closer to 1995 than 1999, unusual occurrences like Nasdaq stocks showing more 'panic' in rallies than sell-offs and record equity momentum raise concerns over fragility events in tech stocks. The uncertainty surrounding AI's impact on the global economy and the dominance of price momentum, combined with meme stock popularity, could potentially lead to irrational market behavior, as seen in the recent GameStop surge led by Keith Gill.
Source: YAHOO