Investing in the stock market can feel like navigating a minefield—especially when individual stock prices can soar or plummet in weeks. As an expert in finance and investing, and a university professor who teaches these concepts, I’ve witnessed countless portfolios need crucial adjustments to avoid unnecessary risk. Today, I’m breaking down the top five stock positions that I’m advising my private clients to reconsider or exit before August 1, 2025. This guidance is grounded in real data, market dynamics, and behavioral patterns that many investors fall prey to, such as chasing returns at the wrong time.
Whether you’re deep into Bitcoin, crypto, BTC, blockchain, or keeping up with the latest CryptoNews, it’s vital to understand how these positions fit within a balanced portfolio and the risks they carry. I’ll also touch on how to approach crypto-related investments in a smart and diversified way. Buckle up as we dive into the five major positions you need to rethink now to protect your wealth and maximize your potential returns.
Why Chasing Returns Can Be Risky in 2025
One of the biggest mistakes I see investors make, even those with six, seven, or eight-figure portfolios, is chasing stocks that have recently skyrocketed. When a stock has doubled or more in the last few months, it triggers fear of missing out (FOMO), tempting investors to jump in at peak prices. But let me be clear: buying into a stock at its all-time high is often the riskiest move you can make.
Risk in investing can shift on a dime, especially with individual company stocks. A portfolio can drop 25% or more in a matter of weeks if the market sentiment changes or earnings disappoint. As much as I love teaching investing and finance, I always remind my clients that they must be vigilant about risk, not just potential reward.
1. Nvidia: A Market Leader with a Sky-High Valuation
Nvidia has been the darling of the AI revolution, boasting a market capitalization north of $4 trillion. It’s the undisputed global leader in its category, powering artificial intelligence and computing advancements. If you bought Nvidia stock a year or two ago, you’re likely sitting on significant gains right now.
However, the problem lies in Nvidia’s current price-to-earnings ratio (PE ratio), which many strategists see as dangerously high. The market is pricing in sky-high expectations for earnings growth, and if Nvidia fails to meet or beat these, the stock could tumble sharply.
To put this into perspective, for your $1,000 investment today to double to $2,000, Nvidia’s market cap would need to grow from $4 trillion to $8 trillion. Globally, only 11 companies have ever crossed the $1 trillion valuation mark, and just three have gone beyond $3 trillion. An $8 trillion valuation is highly unlikely in the near future.
Meanwhile, the S&P 500 has historically doubled investors’ money approximately every seven years, consistently over the past 70 years. So while Nvidia is an amazing company, buying new positions at its all-time high is not the smartest move when better opportunities exist for faster returns.
Key takeaways:
- Nvidia’s valuation is extremely high, reflecting optimistic expectations that may not materialize.
- Buying Nvidia now at its peak price is risky for new investors.
- Holding existing positions is fine, but don’t chase Nvidia with new money at this stage.
- Consider diversifying into stocks with better risk-reward profiles for 2025.
2. International Stocks: Not the Time to Chase the Rally
In 2025, international stocks have outperformed the U.S. markets significantly. The S&P 500 is up about 6-7% year-to-date, while international markets have surged 16-18%.
This outperformance has been largely fueled by a weakening U.S. dollar, which boosts the value of international stocks for U.S. investors. The U.S. dollar index is down roughly 10.7% versus a basket of major currencies.
However, despite the recent gains, the U.S. S&P 500 has historically outperformed developed international stocks over longer horizons such as 3, 5, and 10 years. The current rally in international funds is at or near all-time highs, making it a poor time to sell your U.S. holdings and pile into international ETFs or index funds.
Many investors regret not having more international exposure earlier and try to “catch up” by reallocating now. This is a classic case of chasing returns at the wrong moment.
The better approach is to educate yourself on the role of international stocks in your portfolio and wait for geopolitical, tariff, and trade tensions to ease, which could create buying opportunities at cheaper valuations.
- Don’t sell U.S. stocks that are down just to buy international funds at their peak.
- Plan your international exposure as a long-term allocation, not a quick trade.
- Wait for better entry points once market conditions normalize.
3. Speculative Transportation and Urban Air Mobility Stocks
Innovation in transportation is an exciting space, with companies aiming to revolutionize urban travel through electric vertical takeoff and landing (eVTOL) aircraft. Two pioneers in this emerging urban air mobility sector are Joby Aviation and Archer Aviation.
These companies promise to reduce urban traffic congestion by transforming 30 to 90-minute commutes into 10 to 20-minute flights, potentially creating a new layer of point-to-point air transit beyond helicopters and taxis.
Both have impressive partnerships with industry giants:
- Joby Aviation partners with Delta, Toyota, Uber, and even the U.S. Air Force.
- Archer Aviation has alliances with United Airlines, Stellantis, Enduro, and Palantir.
Financially, Joby holds $1.4 billion in cash, and Archer has raised $2 billion. However, the risks are substantial:
- Joby is burning $500 million annually.
- Archer has no top-line revenue yet and is losing about $100 million per quarter.
- Regulatory hurdles and FAA certification for commercial flights remain uncertain.
- Short sellers have criticized these stocks, and competition is fierce from companies like Lilium and Wisk.
Despite the hype and promising technology, these remain highly speculative investments. What concerns me is seeing investors put 30-40% of their portfolios into several speculative stocks like these, rather than limiting exposure to 10% or less.
Speculation can pay off, but more often than not, these bets don’t pan out. If you want to dabble in this space, keep your exposure small and balanced.
4. Crypto-Related Stocks vs. Holding Bitcoin Directly
Bitcoin, crypto, BTC, blockchain, and all things crypto continue to dominate headlines and investor interest. The digital transformation of finance is undeniable. Cash usage is dwindling, and blockchain technology is reshaping how money flows globally.
Many investors are excited about crypto-related stocks like Coinbase and MicroStrategy, companies heavily tied to crypto’s fate. Coinbase is a leading crypto exchange, while MicroStrategy has famously tethered its treasury to Bitcoin holdings.
However, these companies face significant regulatory risks and market volatility:
- MicroStrategy’s fortunes are directly tied to Bitcoin’s price; a crypto crash could collapse the company.
- Coinbase faces increasing regulatory scrutiny that could impact its business.
Personally, I prefer holding Bitcoin itself over these crypto-linked stocks. Bitcoin as an asset has proven resilient and is becoming increasingly accepted worldwide.
For those wanting exposure to the crypto industry without picking individual winners, consider diversified growth ETFs like QQQM, SCHG, or VUG. These funds include crypto juggernauts among many other growth companies, spreading risk and avoiding the pitfalls of betting on a single company.
- Holding Bitcoin directly reduces company-specific risk.
- Diversified growth ETFs provide balanced exposure to the crypto ecosystem and broader tech growth.
- Don’t overexpose your portfolio to speculative crypto stocks or individual cryptos.
5. Opportunity Cost: Don’t Let Cash and Bonds Drag Your Portfolio Down
2025 has been volatile. When the stock market dropped sharply in April, many investors were relieved to have a portion of their portfolio in defensive assets like bonds or cash equivalents. Bonds did their job, cushioning the blow during the 15% drop in the S&P 500.
But here’s the catch: many investors are now holding too much cash or bonds on the sidelines, missing out on the stock market’s strong rebound.
From April to mid-July, the S&P 500 surged from about $500 to $623 per share—a 20-24% gain in just a few months. The Nasdaq 100 ETF (QQQM) jumped roughly 28% in the same period.
If you had kept your cash parked instead of buying the dip, you missed out on these monster returns.
For younger investors with decades ahead to grow their portfolios, holding excessive cash or bonds can cause significant underperformance over time. Bonds are important, especially for retirees or those living off their portfolios, but for growth-focused investors, it’s critical to stay invested in stocks.
- Use market dips as buying opportunities rather than holding cash indefinitely.
- Balance bond holdings according to your risk tolerance and time horizon.
- Avoid letting fear cause you to miss out on market rebounds.
Final Thoughts on Smart Investing in 2025
Investing isn’t about chasing the hottest stocks or jumping on every trend. It’s about managing risk, understanding valuations, and staying disciplined. The five positions above are common pitfalls I see in portfolios that need fixing now.
If you want to simplify your investing strategy and avoid unnecessary risk, consider a diversified portfolio approach focusing on well-valued stocks, balanced international exposure, limited speculation, and strategic crypto investments.
For those seeking personalized guidance, I’m available for private financial coaching sessions to review your portfolio and craft a strategy that fits your goals. Reach out via email at professorg.invest@gmail.com, and I’ll share my calendar link for a consultation.
Remember: smart investing is about patience, education, and avoiding the temptation to chase returns blindly. With the right approach, you can grow your wealth steadily and confidently in 2025 and beyond.
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