Wharton's Jeremy Siegel warns that stocks could drop 10% as soon as December - hold fast with these 3 'conservative' tech picks

Wharton’s Jeremy Siegel warns that stocks could drop 10% as soon as December — hold fast with these 3 ‘conservative’ tech picks
Wharton’s Jeremy Siegel warns that stocks could drop 10% as soon as December — hold fast with these 3 ‘conservative’ tech picks  

The stock market could suffer a 10% correction as early as December if the Federal Reserve starts cracking down on inflation, a respected author and professor of finance says.

With inflation hitting a 30-year high of 6.2% in October, Jeremy Siegel expects the Fed will finally roll up its sleeves at its next meeting. That could mean the end of low interest rates and the beginning of market volatility.

"When the Fed gets serious, and I think they will at this December meeting, we're going to see some tremors," the Wharton School prof recently told CNBC.

Even so, Siegel believes the stock market remains the only reliable source of inflation-topping returns, and that "conservative tech stocks" should perform well.

Here are three stocks that could shield your portfolio from the howling winds of inflation and turn a healthy profit, especially if you're investing for free.

Microsoft (MSFT)

Microsoft Azure
Microsoft Azure  

One of Microsoft's greatest defenses against inflation is an enormous user base that depends on the company's tech for both personal and business uses.

Check out these recent numbers: 54 million Microsoft 365 subscribers; 250 million Microsoft Teams users, 1.3 billion Windows 10 users. These tend to be highly invested customers who aren't likely to flee to other companies in the face of modest price hikes.

The same can be said for Microsoft's growing list of Azure clients. The company's cloud technology is just too central to many businesses for them to shy away from higher prices.

(If you're going through a budget crunch of your own right now, remember that you can always keep up the momentum by investing with just your "spare change.")

The cloud has been a game-changer for Microsoft. In the first quarter of fiscal 2022, cloud sales rose by 36% year-over-year. They were a major factor in the company's overall revenue growing by 22%.

Microsoft's stock price is up a whopping 51% this year.

Apple (AAPL)

Apple store
Apple store  

Microsoft may have a dedicated user base, but Apple benefits from customer loyalty that can border on obsession. That's great news for inflation-era investors.

Apple's customers have never balked at paying high prices for premium phones, laptops or watches, and their insatiable appetite for the company's devices has made it the world's biggest tech company in terms of revenue.

A mountain of capital and a willingness to innovate should allow Apple to keep evolving and providing long-term value. The company's plans to reimagine the iPad and get into the electric vehicle market could open significant new revenue streams.

When those streams start flowing, it'll be icing on an already sweet cake. Apple's fourth quarter, which wrapped up in September, saw revenue shoot up 29% to $83.4 billion.

Apple's stock has risen 21% this year.

Amazon (AMZN)

Amazon delivery
Amazon delivery  

How can stock in a retailer be a hedge against inflation? When that retailer is Amazon, the calculation changes a little.

Amazon remains a go-to option for online shoppers looking to save money. The wide selection of products on offer creates competition between retailers, which keeps prices in check - and people returning to the site.

Like Microsoft, Amazon is relying more and more on its cloud-computing division to drive profits, which makes the company a strong long-term play. In the third quarter alone, revenue generated by Amazon Web Services hit $16.1 billion, a 39% increase over Q3 2020.

With a single share worth more than $3,500, Amazon might not normally be your first choice as a hedge. But you can still get a piece of the company using a popular app that allows you to buy fractions of shares with as much money as you are willing to spend.

A real alternative to the stock market

Andy Warhol gallery
Andy Warhol gallery  

The main reason Siegel is keeping his money in the stock market is because of his belief that there are no better alternatives to owning stock when inflation is raging.

"Even with a little bit of bumpiness in stocks, you have to be wanting to hold real assets in this scenario. And stocks are real assets," he says.

But stocks aren't the only real assets out there; so are collectibles. And contemporary art, which has outperformed the S&P 500 almost every year since 1995, is a particularly intriguing option.

Normally buying works by Banksy or Andy Warhol is reserved for people who are already fabulously wealthy.

However, a new platform allows you to purchase shares in rapidly appreciating modern masterpieces without having to spend millions of dollars.

This article provides information only and should not be construed as advice. It is provided without warranty of any kind.


More Related News

A Year
A Year's Worth of Nasdaq Tumult Was Condensed Into Three Weeks

(Bloomberg) -- Many ways exist to chart shakiness in the stock market. There's options-derived volatility indexes, price relative to moving averages and...

Report: Bobby Kotick Meeting Leaves Activision Blizzard Staffers Unimpressed, Worried
Report: Bobby Kotick Meeting Leaves Activision Blizzard Staffers Unimpressed, Worried

This morning, Bobby Kotick held an all-hands meeting with Activision Blizzard employees to address Microsoft's acquisition of the company for $68.7 billion...

Analysis-Microsoft faces challenge cleaning up Activision Blizzard
Analysis-Microsoft faces challenge cleaning up Activision Blizzard's culture
  • US
  • 2022-01-20 20:49:17Z

The success of Microsoft's biggest deal ever rides on rehabilitating Activision Blizzard's culture, Microsoft CEO Satya Nadella declared after announcing the...

U.S. House Speaker Pelosi says banning member stock trades possible
U.S. House Speaker Pelosi says banning member stock trades possible
  • US
  • 2022-01-20 20:25:35Z

U.S. House of Representatives Speaker Nancy Pelosi on Thursday signaled her willingness to advance legislation that could ban lawmaker stock trades, if her...

Amazon's longtime strategy of hiring 'missionaries' over 'mercenaries' is imploding, employees say

Working at Amazon is more challenging than ever, and the "Great Resignation" is leading to more open positions and competition for talent.

Leave a Comment

Your email address will not be published. Required fields are marked with *

Cancel reply


  • daytrading-software.net
    (2021-11-30 06:48:42Z)

    Durch die richtige Daytrading Software kann man an den Entwicklungen an der Börse erfolgreich partizipieren. Sehr wichtig ist dabei, dass man sich vor einer Registrierung bei einem Daytrading Broker überlegt, ob denn die angebotene Trading Software das richtige Mittel für die Spekulation auf Börsenkurse darstellt. Immerhin hat diese zumindest den gleichen Stellenwert wie etwaige Kosten für das Trading. Deswegen ist es so wichtig, dass die Daytrading Software wirklich hochwertig ist und mit dieser professioneller Handel möglich ist. Wenn nun Wharton's Jeremy Siegel davon ausgeht, dass die Kurse um 10% einbrechen könnten, dann wäre das eine Chance mittels Short gehen, 300% Gewinn zu machen, sofern die Daytrading Software einen Hebel von 1:30 für Privatanleger zur Verfügung stellt. Natürlich kann man auch einfach sein Wertpapierdepot kurzfristig absichern, aber auch dafür wird man die richtige Trading Software benötigen.
    Man darf nicht vergessen, dass beim Daytrading mit Hebeln immer das Risiko besteht sein Kapital sehr rasch zu verlieren, aber wenn die Aussagen von Jeremy Siegel zuverlässig sind, dann kann man ja auf Risiko gehen. Für den Fall der Fälle, sollte man aber natürlich die Stopp-Möglichkeiten nutzen, welche die Daytrading Software zur Verfügung stellt. Eine Nachschusspflicht gibt es ja glücklicherweise nicht mehr für Kleinanleger, sofern der Onlinebroker seinen Sitz in der EU hat. Darauf sollte man, ganz unabhängig von der Daytrading Software, besonderes Augenmerk legen.


Top News: Economy