Financial Notes

NOTE 👋

It’s been a peculiar couple of weeks in financial markets, but I’m seeing similar patterns play out again via observations on social media and buying behaviour on the brokerage app I use that could become costly. Let's talk about the background to all of this…

MARKETS 📈

5-Day Performance Breakdown:

🇺🇸S&P500 -2.14%

🌍 FTSE All World Index -1.05%

🥇Gold +4.14%

🥈Silver -7.10%

🖲️ iShares Expanded Tech - Software Sector ETF -13.3%

🤖 WisdomTree Artificial Intelligence ETF -4.83%

_{Data as at 06/02/25 at 10:30AM UK Time.}

It’s been a tough old week or so for investors, and there has been a huge shift in investor capital in recent weeks too.

First it was gold…

Prices skyrocketed 28% from January 1st to record highs of $5,600/oz, before crashing 13% to where we are currently at $4,858/oz as at writing.

Silver did something similar, but more extreme…

Running up 68% from January 1st to record highs of $121/oz, before crashing 39% to where we are currently at $73.80/oz.

But it’s not the price moves that I find so interesting here, it’s investor behaviour that i’ve observed…

Above is two screenshots, one from January 2025, the other from February 2026 of the Most Popular ETF’s on the Trading 212 app.

Notice the difference?

In Jan 2025 an iShares Physical Gold ETF was 6th most popular in the app, Silver though, nowhere to be seen.

In Feb 2026, iShares Physical Gold ETF is now 4th most popular in the app, and the iShares Physical Silver is now 6th most popular.

To me this is interesting, given the headlines in the press before the crashes we saw were like this, and we were bombarded with them daily!!

Headlines like this create a new kind of gold rush…

And as an investor, who is seeking the best returns possible, it’s hard to resist, because it feels like prices will keep rising and nothing will stop it.

This is where investors fall into a trap.

It’s called FOMO, Fear of Missing Out.

Herd mentality results in investors buying in, (as we can see from Gold & Silver ETF’s shooting up on Trading 212’s most popular ETF rankings), but the problem is that there is a high probability they have:

And this is where investors start to run into problems, because the inevitable happens of a market decline, as we’ve now seen. Institutions and smart investors have took their profit. Whilst unsuspecting investors who thought they were going to see huge upside are left looking at their brokerage account with unrealised losses.

This problem then compounds because of something called Loss Aversion.

It’s where investors feel more pain from losing money than they do from gaining it, so they sell their positions and lock in their losses at fear of losing even more money.

OUCH!

There is hopefully a lesson that we can learn from this though…

In that it reinforces the importance of behavioural discipline when investing.

I always preach long term investing, “have a long term mindset” and all that, because it stops me from making short term decisions to try and make short term profit which could likely be hugely detrimental to my long term investment returns.

And if I had have jumped in and bought gold and silver (knowing my luck at somewhere near record highs), i’d be sat in huge losses right now, wondering what to do with my investments…

But that’s not the full story in todays Financial Note, oh no, there is more to discuss…

When investing your capital is at risk. Past performance isn’t necessarily indicative of future results. Always do your own research.

TECH STOCKS 📉

If you’re an investor in Amazon (-12.27%), Microsoft (-10.34%), Oracle (-10.12%), Palantir (-13.44%), AMD (-18.44%), Qualcomm (-9.26%), Crowdstrike (-14.48%) you’ve probably had a tough week.

_{Data as at 06/02/25 at 10:30AM UK Time.}

And even if you don’t directly own these stocks individually, if you own an S&P500 fund, all world fund or tech fund, it will have effected you in some way because we saw a $1,000,000,000,000 sell off.

Big ol’ number that is, but is it justified? Well here are a few reasons why stocks sold off this past week:

AI start up Anthropic released new tools that the company says can do more tasks for the legal industry (CNN). It’s made investors nervous about the actual potential AI has to disrupt industries, and ultimately start effecting companies bottom lines because AI could be cheaper than people?!

It’s been a week or so of earnings call too, some went well, others not so much, but there is still BIG spending commitments to build out data centres and infrastructure to power the AI boom.

It’s all coming, but it raises questions as to how immediately profitable this building rush will prove. When will spend turn into huge profit?!

We’ve spoke about this many times before on the channel, but big tech still sits with fairly lofty valuations, and the moment Wall Street have a sniff of adverse performance the selling commences.

AMD were the big loser this week after CEO Lisa Su addressed guidance concerns, which resulted in the biggest single day sell off since 2017!

Thats very much the highlights of the week, but if this is one thing that you do remember from this weeks Financial Note, its this quote from Warren Buffet:

“The most important quality for an investor is temperament, not intellect”

A SMALL FAVOUR ❤️

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VIDEO OF THE WEEK 🎬