"Continuous Buying" author is also scared! Nick Maggiulli openly admits to reducing his holdings by 20%: This is considered bearish for me...

"Just Keep Buying" author and Wall Street data analyst Nick Maggiulli candidly admitted in an interview that due to AI valuation surges, he once reduced his retirement account from 100% stocks to an 80/20 stock-bond allocation, marking the first time he's been bearish since writing his book.
(Background summary: Nvidia announced on Wednesday: $78 billion in revenue estimated to set a record, options market initially bought 10% volatility insurance)
(Additional context: Three ways to short the AI bubble: find a wedge, find victims, wait for confirmation before re-accumulating)

Table of Contents

Toggle

* Nvidia's Price-to-Sales ratio and 1999 Microsoft "exactly the same"
* Those waiting for a correction, buy at a higher price three years later
* The biggest problem with stock picking isn't choosing wrong, it's wasting your time
* Frequently Asked Questions

Three years ago, a book was published teaching everyone "no matter market rises or falls, just keep buying," Nick Maggiulli probably didn't expect that by 2026, even he wouldn't dare do that anymore.

In a 55-minute conversation on the YouTube channel "A Bite of New Rice," this Wall Street analyst, who has written a daily data blog for ten years with over 500 articles, rarel y admits that he "unprecedentedly feels a bit pessimistic," and adjusted his retirement account from 100% stocks to an 80/20 stock-bond mix. By his own standards, this is equivalent to being bearish.

What triggered this mindset shift was AI valuation.

### Nvidia's Price-to-Sales ratio and 1999 Microsoft "exactly the same"

Nick said that when he compares Nvidia's current Price-to-Sales ratio with that of Microsoft in 1999, "it's exactly the same." He prefers the Price-to-Sales ratio over the Price-to-Earnings ratio because profits can be manipulated through financial tricks, but fake sales are essentially fraud, "very few people dare to do that." Looking at the data, he thought: "This looks crazier than the dot-com bubble."

But what made him turn bullish again was the data. He mentioned that Anthropic's ARR shot from $3 billion to $45 billion within a year, "I can't imagine how a company could do that, but they did it easily." He described it as a gradual realization that he was wrong, with no specific moment of turning bullish. "Many things I thought wouldn't happen, ended up happening. So I was wrong, that's normal."

It's worth noting that even at the most pessimistic, Nick didn't liquidate everything. He quoted Clifford Asness, founder of hedge fund AQR, calling it "a little indulgence" that allows for some tactical adjustments, but never going all-in.

### Those waiting for a correction, buy at a higher price three years later

Nick shared a recurring example: in early 2017, an investor said, "I'll wait for the market to crash before buying." Three years later, on March 23, 2020, during the COVID-19 crash with a 33% drop, even if he had perfectly bought the bottom, the purchase price would still be higher than what he could have bought in 2017.

> "Most people won't go back and calculate,
>
> whether the price on the day they bought the dip was really lower than the day they didn't buy."

Nick said this is the deadliest blind spot in buying on dips. He also referenced the Great Depression of 1931: the market had already fallen 50%, seeming like an excellent buying opportunity, but by summer 1932, it fell another 60%. "You keep talking about buying on dips, but sometimes you're facing a bottomless plunge."

For friends selling covered call options, he brought up Taleb's "Turkey Problem": the turkey is fed daily, confidence soars, "until the farmer comes with a knife."

He also mentioned the XIV fund, which acts like a printing press when volatility is low, but when volatility spikes, the fund goes to zero. Nick's mantra is "buy fast, sell slow": historical data shows that a lump sum investment earns about 4% more than a 12-month dollar-cost averaging. If you can accept a 4% lower return for psychological safety, dollar-cost averaging is fine, just don't stretch it beyond five years.

### The biggest problem with stock picking isn't choosing wrong, it's wasting your time

Nick's three reasons against individual stock investing are:

* First is "performance theory": the SPIVA report shows that about 80% of professional fund managers underperform the benchmark over five years.
* Second is "existentialism": if you play basketball against LeBron James, an observer can tell who’s better in a minute; but if two people pick stocks, it might take ten years to see who’s truly skilled and who’s just lucky. "No one wants to look in the mirror and admit they’re just riding luck."
* Third is the most powerful "time value": $1,000 earning 10% yields $100; $1 million earning 10% yields $100k. For most people still building wealth, spending an hour writing an article, running a side business, or improving skills creates almost more income than researching a stock. "Researching stocks is only worthwhile when you're already very wealthy."

His own allocation is simple: about 80% stocks (half US, half international), 20% bonds (all short-term under five years), 2% Bitcoin (based on the best portfolio optimizer results from 2019), gold and other non-yielding assets less than 5%. Currently, due to preparing to buy a house, he’s increasing short-term government bonds, but emphasizes this is purely personal planning, unrelated to his views on AI or the market.

Nick doesn't teach which stocks to pick, nor does he predict tomorrow's rise or fall. He still reiterates the point of surviving until the end amid uncertainty.

### Frequently Asked Questions

What is Nick Maggiulli's "continuous buying" strategy?

The core principle is "keep buying diversified income-generating assets," including stocks, bonds, and real estate. No timing, continuous buying, with a portfolio diversified across US stocks, international stocks, and fixed income. The actual allocation is about 80% stocks plus 20% short-term bonds.

Is lump sum investing better than dollar-cost averaging?

Historical data from the US stock market shows that lump sum investing earns about 4% more than a 12-month dollar-cost average. But Nick believes that if dollar-cost averaging helps you feel secure, losing 4% isn't fatal. The key is choosing one method and sticking to it, without stretching beyond a year.