Plenty Of Warning Signs A 5-7% Correction May Happen Soon | Lance Roberts

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Jul 19, 2025

In this discussion, Lance Roberts, a portfolio manager known for his insights in finance and investment strategies, warns of a looming 5-7% market correction. He highlights the current overvaluation of stocks and the psychological traps of options trading, emphasizing risk management. The conversation also touches on bond yields, the potential influence of political changes on the Federal Reserve, and the accelerating threat of AI on jobs. Lance's compelling analysis offers valuable advice for navigating these volatile economic waters.

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ADVICE

Trim and Hedge in Overbought Markets

Take profits and rebalance your portfolio when positions get oversized.
Use options like out-of-the-money puts or calls for cheap portfolio insurance during overbought markets.

INSIGHT

Speculation at 1999 Levels

Current market speculation is unprecedented since 1999, fueled by new financial instruments and retail interest.
Increased speculation often precedes market corrections, signaling elevated risk today.

ADVICE

Prioritize Absolute Returns

Focus on absolute returns aligned with personal goals rather than relative market performance.
Avoid chasing market beats; prioritize avoiding large drawdowns to protect long-term growth.

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Stocks have risen so far so fast, and remain so overbought in the short term, that the risk of a correction in the near term is uncomfortably high.So warns portfolio manager Lance Roberts.He could easily see a pullback of 5-7% occur over the coming weeks.We discuss the odds of that, as well as bond yields, whether President Trump will actually fire Fed Chair Jerome Powell, the accelerating AI threat to jobs, and Lance's firm's latest trades.For everything that mattered to markets this week, watch this video.

WORRIED ABOUT THE MARKET? SCHEDULE YOUR FREE PORTFOLIO REVIEW with Thoughtful Money's endorsed financial advisors at https://www.thoughtfulmoney.com#federalreserve #bondyields #marketcorrection _____________________________________________ Thoughtful Money LLC is a Registered Investment Advisor Promoter.We produce educational content geared for the individual investor. It’s important to note that this content is NOT investment advice, individual or otherwise, nor should be construed as such.We recommend that most investors, especially if inexperienced, should consider benefiting from the direction and guidance of a qualified financial advisor registered with the U.S. Securities and Exchange Commission (SEC) or state securities regulators who can develop & implement a personalized financial plan based on a customer’s unique goals, needs & risk tolerance.IMPORTANT NOTE: There are risks associated with investing in securities.Investing in stocks, bonds, exchange traded funds, mutual funds, money market funds, and other types of securities involve risk of loss. Loss of principal is possible. Some high risk investments may use leverage, which will accentuate gains & losses. Foreign investing involves special risks, including a greater volatility and political, economic and currency risks and differences in accounting methods.A security’s or a firm’s past investment performance is not a guarantee or predictor of future investment performance.Thoughtful Money and the Thoughtful Money logo are trademarks of Thoughtful Money LLC.Copyright © 2025 Thoughtful Money LLC. All rights reserved.