Tech Stocks Are Taking Over

Right now, technology stocks have become a huge part of the market. Almost 35% of the MSCI index market cap belongs to tech stocks. This big jump is mainly because of the rise of AI stocks. The situation looks very similar to the dot-com time when tech stocks had a 36% share. Back then, it turned into a big bubble.

Are We in a Bubble Again?

The big question today is whether we are entering the same kind of bubble. 36% is not a magical number, it could be 30%, 40% or even 60% in the future. But the past data shows that such high levels of concentration can be risky. It is important to be aware of this zone and stay cautious.

The Rise Has Been Different This Time

During the dot-com bubble, tech stocks jumped very fast, moving from 10% to 36% in just 5 years. This time the move has been slower. It has gone from 5% to 35% in about 13 years. That means it was not a vertical rise. But the worry is that from here, a sharp vertical rise can still happen. And if that happens, it could be followed by a big crash.

Why Investors Need to Watch Closely

The current levels are not an automatic sign of danger. But they show that the market is entering a risky zone. If a sudden surge comes, there could be a capitulation or sharp fall after it. This makes it very important for investors to keep a close watch on their holdings and not get carried away by the hype.

The Need for a Clear Exit Plan

If you are holding AI or tech stocks, either in the US or in India, the most important thing is to have a strategy to exit. Markets can fall suddenly, and waiting for years to recover is not a smart plan. Having clear rules to act when something breaks down can save investors from huge losses.

Stay Prepared, Stay Safe

The lesson is simple. Tech stocks are powerful and can rise fast, but they can also fall sharply. Having a plan in place removes the fear. If investors are ready with a strategy, they do not need to worry even if markets turn against them.