Individual Investors Brave On Despite Bubble Fears

The recent volatility in the stock market and the deep selloff in many of the most widely held big tech stocks have not scared individual investors away, at least for now, according to Investopedia’s recent sentiment survey of our readers. While many think there are still bubbles in AI-related and mega-cap tech stocks, they continue to hold them in their portfolios and expect better returns ahead.

Geopolitics Tops the List of Worries

While the general sentiment is optimistic, 40% of respondents say they are either worried or somewhat worried about the stock market and their portfolios lately. That’s a slight increase from December, and given the drawdowns in widely held stocks like Nvidia (NVDA), Palantir (PLTR), Microsoft (MSFT), and Netflix (NFLX), their concerns are warranted. 

But a selloff in the stock market and their concerns about overvaluations in some stocks and sectors are not as high as their worries about geopolitical unrest. That is now respondents’ top concern, supplanting tariffs and inflation that had been the top concerns in past surveys.

Bubbles in Stocks and Shiny Things

Individual investors have gotten used to investing in what they perceive as frothy markets, and most respondents to our survey believe we are still in one of those despite the selloff in some of the most widely held stocks. AI-related stocks like Nvidia remain their top choice for assets they believe are overvalued, but gold has been steadily climbing that list and is now their second choice for bubbly assets. 

The sharp rise in gold prices over the last year has dominated headlines, with the metal hitting multiple record highs, as many investors have flocked to it for its perceived stability. The volatility in gold prices over the past several weeks has been a stark reminder that no asset is totally stable in volatile times. Mega-cap tech stocks are also high on investors’ list of overvalued assets, as they have been throughout this bull market, now in its fourth year.

We Own What We Fear

While we may fear overvaluation in AI and big tech stocks, they continue to dominate our respondents’ portfolios. Our top holdings resemble those of S&P 500 index funds and ETFs, as well as the Nasdaq 100. Individual investors have remained faithful to these stocks despite downtrends in many of them, including Tesla (TSLA), Amazon (AMZN), and AMD (AMD). 

Investors Flock to Their Favorites

Not only do individual investors continue to buy and hold the big stocks they’ve owned for years, but they continue to believe that they will deliver the best returns in 2026 and for the next decade. When given a choice of up to ten diverse asset classes or securities that they believe would deliver the best performance in 2026, the Nasdaq 100 was their top choice, followed by semiconductors, the Magnificent 7 stocks, and then gold. Bitcoin, which has been in another dizzying bear market, was among respondents’ last picks to outperform in 2026.

What Would You Do With an Extra $10,000?

Individual stocks still top respondents’ wish-lists of what they would do with an extra $10,000 if they had it. Stocks have been their top choice for most of the past 12 months as they watched many individual equities soar amid temporary spikes in momentum and retail trading activity. 

The fear of missing out remains very powerful among individual investors, and they have chosen to remain bold amid a dizzying flurry of economic headlines and the cold winds of volatility across the capital markets.

Research by Rebecca Marrero