Ideas
Avoid Mag 7; buy equal-weight market.
The market has been the narrowest for the longest period, even more than during the tech bubble, so the risk is concentrated in the Magnificent 7 and top 10-25 stocks, whose premium valuations imply uniqueness even though many US and global companies are growing as fast or faster. In contrast, the broader US stock market and the equal-weighted S&P look attractive and much cheaper.
Avoid Mag 7; buy equal-weight market.
The market has been the narrowest for the longest period, even more than during the tech bubble, so the risk is concentrated in the Magnificent 7 and top 10-25 stocks, whose premium valuations imply uniqueness even though many US and global companies are growing as fast or faster. In contrast, the broader US stock market and the equal-weighted S&P look attractive and much cheaper.
Dividend payers compound wealth, overlooked.
In speculative markets investors forget dividends and treat them as a drag on performance, but dividends are one of the easiest ways to build wealth through compounding; over the last 25 years the S&P dividend index has been neck-and-neck with the Nasdaq, and good US companies with strong balance sheets yield 3-5%.
Non-US equities are cheap and ignored.
Non-US stocks are underweighted and ignored, yet they are growing faster than the Magnificent 7, have dividend yields seven to eight times higher, and sell 30-50% cheaper. He thinks this could be the beginning of a secular bull market in non-US equities, with potential dollar weakness as an additional tailwind.
Buy quality non-US dividend payers.
RBA's Global Dividend Kings strategy targets high-quality non-US companies paying dividends, with better cash flow and less debt. It combines the global undervaluation opportunity with the power of dividends and has worked well for over a decade.
Ignored non-tech small caps may outperform.
Small caps, especially non-tech small companies, are ignored by analysts and investors, but many have strong businesses and are doing well. Historical market leadership rotates, so the lack of attention creates a potential setup.
AI returns disappointing; too much capital.
AI is not starved for capital; investors are throwing money at anything AI-related, even in fixed income. Since long-term investment returns depend on the supply and demand for capital, long-term AI returns are likely to be disappointing even if AI gets embedded into the economy faster.
Buy capital-starved US small-cap industrials.
The US has a massive trade deficit while globalization contracts, creating a need for re-industrialization. Capital markets should allocate capital to small and midcap US industrial companies that are starved for capital and where returns can be high, which RBA calls the American Industrial Renaissance.
Avoid corporate credit at narrow spreads.
Corporate credit spreads are historically narrow, with only three prior comparable periods, each preceding a credit or inflation shock. Investors are not being compensated for the risk, so RBA holds zero corporate credit in fixed income portfolios and is trying to avoid the asset class.
Avoid duration; 10-year yields may rise.
Inflation is not dead and nominal GDP is tracking 5-8%, making aggressive Fed rate cuts unlikely. If the Fed does cut, faster growth or inflation could push long-term rates up, so RBA is not taking duration risk and is not going out on the curve.
Crypto is a global speculative bubble.
Crypto is in a major bubble and is the first truly global investment bubble, with all the characteristics of historic financial bubbles. Its high correlation with liquidity and high-yield spreads shows it is a speculative asset, not digital gold, regardless of whether it has long-term utility.
This Meb Faber Show video, published January 23, 2026,
features Richard Bernstein
discussing MAGS, RSP, Dividend-paying stocks, VXUS, Global Dividend Kings, Non-tech small-cap stocks, AI-SECTOR, AIRR, LQD, TLT, BTC, Cryptocurrencies.
11 trade ideas extracted by AI with direction and confidence scoring.
Speakers:
Richard Bernstein
· Tickers:
MAGS,
RSP,
Dividend-paying stocks,
VXUS,
Global Dividend Kings,
Non-tech small-cap stocks,
AI-SECTOR,
AIRR,
LQD,
TLT,
BTC,
Cryptocurrencies
