Let's talk a little bit more about the tech trade. Nvidia trading near record highs as tech per usual big driver of the market's push higher. The tech sector, is it poised to remain the market leader? That's the big question. Our very own Josh Schafer joins us now at the desk. You've been digging into this and this leadership that we've seen from tech in this rally.

Yeah, Brad, so I mean, you have the S&P 500 back near record highs, of course, Nvidia also back near record highs, as you mentioned, right? And so the question I've sort of been posing the strategist over the last week is, okay, well, if we go higher, what takes us higher, right? What's sort of this next leg of the bull market? And I think it's interesting because you sort of hear both sides of this trade, right? Like the folks over at City, they just moved up their S&P 500 target to 6300. They're still talking about growth is defensive. You think about a lot of these companies, Nvidia would probably be included in that, maybe an Apple, all really all of them, right? Are cash rich businesses, they're businesses that can do well if rates stay higher. But what I thought was interesting, different take from Richard Bernstein over at Richard Bernstein Advisors. He had a note out calling it the mid seven.

Mhm.

And so when I talked to Richard, he highlighted this chart. Uh this is the percent of stocks that have outperformed the S&P 500. Of course, those two little lines you see over the last two years are 2023 and 2024, right? That was your mag seven led rally. Well, pick your head up. Stocks outside of the mag seven have been doing very well thus far in 2025, right? You've seen a lot of outperformance from a lot of the other sectors. I think seven of the 11 S&P 500 sectors are outperforming the index. And so Bernstein sort of making the point that as growth slows for that mag seven cohort. Yes, the earnings year of year growth is still strong, but it is slowing, right? That rate of change is coming down. That might make the case for perhaps some more of the 493 and some other areas of the market to be areas where you can you can play.

I I just didn't expect from mid seven the Gen Z vernacular to make its way into a Richard Bernstein analysis here. It's mid right now.

It's mid. Sometimes it's just mid, Brad.

You know, as we talk about that leadership, Adil, what are you anticipating from the mag seven, especially as we're looking for this diversification within portfolios right now?

Yeah, so we we do think that these companies will continue to do well because what happens is that there's a lot of expenditure that is going into artificial intelligence. There's a lot of government policy that is supporting artificial. There's deregulation also happening. And that makes us believe that because of the productivity that these companies are bringing about because of AI related productivity, that's going to cause GDP to increase as well. So we do think that the mag seven will continue to do well, but one of the problems we see, we deal with a lot of retail investors. One of the problems we see is that people are like overly concentrated in the mag seven. You know, like they'll have 60 to 70% of their portfolio in tech related investments. That's where we want to put the personal finance hat on, and we want to say that this can be treacherous. Make sure you're broad because to your point, there are a lot of other sectors that are doing really well. AI doesn't mean that only mag seven will do well. There are other sectors that could do well also.

Has that rebalancing started to happen among clients yet? Because I feel like April was maybe a wake up or February to April was a little bit of a wake up call, right? Those a lot of those stocks got hammered pretty significantly, but then you had the strong come up really over the last month and a half now. Are clients starting to really wonder like, okay, should I rebalance here? Did I just hold Nvidia? Did really well, and now it's too big in the portfolio?

Well, there's this is where the behavioral finance comes in as well because, you know, people don't want to sell Nvidia like they love it, right? So and we've been where others were being aggressive end of last year, we were being defensive. We were saying all right, you know, take a pause, take a step back, right size your exposure to these companies, increase the breadth of your portfolio. So we have been doing it, but I do feel that the ordinary retail investor that is having a do it yourself approach is overexposed there. Uh if you look at the S&P 500 by itself, that's more than 40% in tech right now. And if you add a few other technology companies in the portfolio, now you're 50, 60% in tech, right? That's the ordinary retail investor that has a do it yourself approach.