Should we buy/ sell/ hold? State of the Stock Market (invest at end of 2025)

About this video

• Video Title: Should we buy/ sell/ hold? State of the Stock Market (invest at end of 2025)
• Channel: Investing Simplified - Professor G
• Speakers: Professor G (Nolan Goa)
• Duration: 00:12:46

Overview

This video discusses the current state of the stock market, characterized by volatility and overvaluation, and provides investment strategies tailored to different investor profiles and goals. Professor G outlines four scenarios: individuals nearing retirement, those currently living off their portfolios, those with a long time horizon before retirement, and those who have received a significant lump sum. He emphasizes a balanced investment approach, advocating for index investing and a diversified portfolio while cautioning against trying to time the market.

Key takeaways

• Market Volatility: The stock market is currently fragile and highly volatile, with news significantly impacting its movements. This instability makes investing challenging.
• Four Investor Scenarios: The video categorizes investors into four groups:
  1. Nearing Retirement (5 years out): Advised to maintain significant equity exposure (90-100%) in a three-fund portfolio, including S&P 500, a value fund (like SCHD), and a growth fund (like QQQM), while holding 10-15% in cash for potential dips.
  2. In Retirement (living off portfolio): Prioritize safety by keeping 2-3 years of living expenses in a high-yield savings or money market account. The remaining investments should be in value-based funds (like SCHD, VYM, FDV) with some exposure to S&P 500 for growth.
  3. Younger Investors (20+ years to retirement): Focus on compound growth. Prioritize paying off high-interest debt (above 6-7%) before investing. A balanced approach is recommended, with 75% in retirement accounts and 25% in a brokerage account, invested in a mix of ETFs.
  4. Lump Sum Investors: Advised against holding cash to wait for a crash. A hybrid approach is suggested: invest half the lump sum immediately and dollar-cost average the remaining half over a calculated period (e.g., 5-10 months) to mitigate psychological impact.
• Investment Strategy: The video advocates for index investing and a diversified "three-fund portfolio" approach, emphasizing long-term growth and avoiding speculative assets like penny stocks or certain cryptos.
• Timing the Market: It is strongly advised against trying to time the market, as statistical data and historical examples show that "time in the market" generally outperforms "timing the market."