Share

Aftershock

Bloodbath or a value investor’s dream? Both retail and institutional investors were busy making moves in the aftershock of sweeping tariffs that wiped trillions off the market.

‘The tariff Pandora's box has been opened,’ noted Goldman Sachs after US$6.6 trillion was wiped out from U.S. equities last Thursday and Friday. It was the worst 48-hour decline in market history.

Hedge funds sold US$40b worth of stocks on Thursday alone, as retail investors bought US$4.7b. It was the biggest hedge fund selling spree and retail buying spree since 2010. But come Friday, retail had stopped much of the dip buying as they came to terms with the Magnificent 7 cohort’s not-so-magnificent session. 

Nvidia ($NVDA), Tesla ($TSLA), Alphabet ($GOOGL), Amazon ($AMZN), Apple ($AAPL), Meta ($META) and Microsoft ($MSFT) collectively shed a trillion dollars in market cap in one day. It’s the worst case scenario for investors with a portfolio overly concentrated in big tech. And that’s because those big tech firms have overly concentrated production in Asia. (China, Taiwan and Vietnam face some of the highest import tariffs).

China still manufactures about 80% of Apple products, so the Cupertino company was hit hard by the news – the stock saw its largest single-day decline in five years. Well, here’s one way to look at it: if your iPhone is about to get more expensive, might as well buy Apple at a discount? 

That philosophy is what Berkshire Hathaway ($BRK.B) chief Warren Buffett is best known for. The value investor thinks it's wise to be greedy when others are fearful, and vice versa. We know that he sold a few of his portfolio favourites over the last year to shore up US$300b in cash… but he doesn’t appear to be deploying it just yet.

Buffett wasn’t the only one shifting gears this year. Nearly 90% of fund managers surveyed by Bank of America in February thought U.S. stocks were overvalued. Around 73% said they thought buying the Mag 7 was the most crowded trade, and most of them had started rotating into bond-sensitive assets.

In the weeks to come, there will be opportunities to hedge downside risks and even rebuild portfolios at better valuations. There might also be more pain. And as investors brace for retaliation tariffs, they also await the start of another earnings season. Big banks JPMorgan Chase ($JPM) and Wells Fargo ($WFC) are first up on Friday, and there’s good reason to believe they’ll lower forward guidance.

There’s no sugarcoating it: this was market carnage. It also might just be a value investor’s dream come true.


Related


Want more?

You know what to do

Insights, trends and company deep dives delivered straight to your inbox.


Stake logo
Over 7,000 5-star reviews
App Store logoGoogle Play logo

Subscribe to our free newsletters

By subscribing, you agree to our Privacy Policy.

Stakeshop Pty Ltd is registered as an overseas company in New Zealand (NZBN: 9429047452152), and is registered as a Financial Service Provider under the Financial Service Providers (Registration and Dispute Resolution) Act 2008 (No. FSP774414). We hold a full licence issued by the Financial Markets Authority to provide a financial advice service under the Financial Markets Conduct Act 2013. However, the content on this website has not been prepared to take into account any of your individual objectives, financial situation or needs. To the extent you require further information about the relevant New Zealand legislation that may apply, or require specific advice, please contact your legal and/or financial adviser (as appropriate). The information on our website or our mobile application is not intended to be an inducement, offer or solicitation to anyone in any jurisdiction in which Stake is not regulated or able to market its services. At Stake, we’re focused on giving you a better investing experience but we don’t take into account your personal objectives, circumstances or financial needs. Any advice is of a general nature only. As investments carry risk, before making any investment decision, please consider if it’s right for you and seek appropriate taxation and legal advice. Please view our Terms & Conditions, Privacy Policy, Financial Advice Disclosure and Disclaimers before deciding to use or invest on Stake. By using the Stake website or service in any way, you agree to our Privacy Policy and Terms & Conditions All financial products involve risk and you should ensure you understand the risks involved as certain financial products may not be suitable to everyone. Past performance of any product described on this website is not a reliable indication of future performance. Stake is a registered trademark under class 36 (New Zealand).

Copyright © 2025 Stake. All rights reserved.

This site uses cookies. By using our site you agree to the Stake Privacy Policy.