I initiated a new small position in Invesco QQQ Trust (QQQ) at $325.1499. Invesco QQQ Trust is not within our top 15 largest positions at this time.
There are many threats to the market and uncertainty including:
1. Political Uncertainty
The uncertainty within the political arena with global uneasiness with Russia/Ukraine, China and much more. Domestically, the country is very divided and there is pressure for people in power to prove themselves of reelection. There seems to be much disappointment of the current administration which will cause pressure to make drastic moves to improve this. There could be more issues with domestic and international trade.
2. Economic Slowdown
The second threat is an economic slowdown. The US economy has been growing steadily for several years, however there is strong pressure to reduce inflation with higher interest rates which could cause the economy to slow down and therefore sales/profits to decrease.
3. Supply Chain Issues
Since COVID, there has been so much disruption and uncertainty with the supply chain. This is major concern for trying to plan and project future sales which most likely is why many companies are aiming low with targets which is upsetting to many investors.
Despite all this, I believe much of it is already priced in and that the QQQ is good way to put money to work on a broad/diversified basis. The overall market will most certainly be higher than it is now in the next few years. While the market could certainly drop more in the short term. If you have a long term investment horizon, now is a great time to slowly put money to work, while pessimism is really high.
We plan to gradually put more money to work if the market stays at these levels or goes lower.