Are AI & Tech Stocks Still a Good Investment? Integrity Investment Advisors Market Update August 2026

In this midsummer investment update, Todd from Integrity Investment Advisors emphasizes the importance of maintaining a diversified asset allocation aligned with a long-term financial plan. He explains that while equities remain essential for wealth compounding and real returns above the rate of inflation, bonds should primarily be used for immediate safety and meeting short-term cash liabilities. The advisor highlights his firm’s recent partnership with Focus Partners, which provides the scale and resources necessary to optimize tax strategies and estate planning for clients. Regarding current trends, he notes that while artificial intelligence and technology have driven significant gains, the market is currently experiencing a healthy rotation into other sectors like healthcare and industrials. Despite recent market highs, the update suggests that the current bull market may still have room to grow due to strong corporate earnings and profitability compared to the dot-com era. Ultimately, encourages investors to avoid the risks of individual stock picking in favor of broad, factor-loaded portfolios and uncorrelated alternative investments.

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5 Key Points:

1. Today’s Tech Market is Supported by High Profitability: In 1995, the top 10 S&P 500 companies had an average net income margin of 7% and a 27% return on equity (ROE). Today, they boast a 30% net income margin and a 58% ROE. Furthermore, powerful earnings have kept forward P/E ratios below their 5- and 10-year averages, demonstrating that the AI and tech trade is supported by hard fundamental earnings rather than pure speculation

2. Bonds Tend to be Optimal for Liability Matching over Capital Appreciation:  While bonds are excellent for short-term safety, cash flow, and liability matching, they are less than optimal for long-term growth. Over 20 years, a $1 million investment in an aggregate bond index grew to $1.7 million, compared to $6.6 million in the S&P 500. Additionally, since 2020, bonds have often fallen in tandem with stocks during down months, which underscores the need for alternative asset classes for diversification.

3. Healthy Market Rotation and Bull Market Longevity: The S&P 500 has recently seen a shift where technology stocks flattened or declined while sectors like healthcare, financials, staples, and industrials sustained market performance. This rotation indicates a healthy broadening of the market. With the current bull market at about 3.5 years old, history suggests that bull markets passing the 3-year mark often average 6.5 to 7 years in length, indicating there may be further room to run.

4. The Brutal Difficulty of Stock Picking:  Picking individual stocks remains an incredibly difficult task; only 9% of individual S&P 500 stocks beat the index over the 12-month period ending in July. We use highly diversified ETFs and factor-loaded portfolios to diversify.

5. A Major Scale Upgrade through Focus Partners: The firm has finalized an integration with Focus Partners, a top-10 national RIA managing $500 billion in assets. This back-office partnership brings institutional size and trading power to clients, while enhancing the firm’s offerings in tax-aware strategies, Long/Short SMAa for concentrated positions (like GOOG, AMD, NVDA, AVGO, AAPL, SPCX, Open AI, Anthropic, etc) , dedicated research teams, family office services, trading desk, estate planning, and more.

Frequently Asked Questions

If you want to work on your personal financial plan or want a 2nd opinion about your strategy & red flags, please schedule a meeting

• Volatility is Inevitable — We Stress-Test Your Plan for it! 04/24/2026

• Why Diversification Matters in 2026: Navigating the 2026 Market 2/19/2026
• Are we in an AI/Tech Bubble 11/5/2025
• Markets are Looking Forward: Recovery From April Lows 8/4/25
• A Roadmap to Succeed in Pullbacks & Recessions 4/5/25
• There is always something to worry about 3/12/2025
• How much risk do you need to take to hit your goals? 11/5/2024
• Is it normal for stocks to go down -5% to -10% in a short period of time?  8/7/24
• Are Things Getting Better or Worse? 3/27/24
• Market Recap & Path Forward 2024 -1/16/24
• Markets Normally Go Up & Bear Markets Are Transitory – 7/16/23
• Stocks are up 11% per year for the last 7 years!  6/30/22
• The Answer to Volatility is Financial Planning 5/6/2022
• Tough Choices — What do we own & why? 2/17/2022
• Are Things Getting Better or Worse? 10/15/2021
• Back to Normal but Now What? 5/7/21

Thanks for reading/watching.  This website is for educational purposes only and is not investment advice.

Benchmark Performance Reports Disclosures:

Historical performance results for investment indexes, ETFs, mutual funds and/or categories, generally do not reflect the deduction of transaction and/or custodial charges or the deduction of an investment management fee, the incurrence of which would have the effect of decreasing historical performance results. None of the indexes, ETF or mutual funds are meant to describe the performance of actual clients.  They are only for informational & educational purposes. The S&P 500 is not the only index used as a benchmark for measuring the performance of a portfolio. Depending upon the holdings in your portfolio, your investment objectives, and your risk tolerance, it may be more appropriate to measure performance against a different benchmark like MSCI World, balanced portfolios or bonds. Economic factors, market conditions, and investment strategies will affect the performance of any portfolio and there are no assurances that it will match or outperform any particular benchmark or index strategy.

 Past performance may not be indicative of future results. Therefore, no current or prospective client should assume that the future performance of any specific investment or investment strategy (including the investments and/or investment strategies recommended by the advisor), will be profitable or equal to past performance levels. All investment strategies have the potential to profit or loss. Changes in investment strategies, contributions or withdrawals may materially alter the performance and results of your portfolio. Different types of investments involve varying degrees of risk, and there can be no assurance that any specific investment will either be suitable or profitable for a client’s investment portfolio.

 The information provided herein is for informational purposes only and is not intended to be, and should not be construed as, legal or tax advice. You should consult with a qualified tax advisor, CPA, or attorney before making any decisions based on this material, as individual situations may vary. We do not provide tax or legal advice. Any tax strategies discussed are general in nature and may not be appropriate for your specific circumstances.

 Information presented is for educational purposes only and does not intend to make an offer or solicitation for the sale or purchase of any securities. Integrity Investment Advisors’ website and its associated links offer news, commentary, and generalized research, are not personalized investment advice. Nothing on this website should be interpreted to state or imply that past performance is an indication of future performance. All investments involve risk and unless otherwise stated and are not guaranteed. Be sure to consult with a tax professional before implementing any investment strategy. Investment Advisory Services offered through Integrity Investment Advisors, a Registered Investment Adviser with the U.S. Securities & Exchange Commission. Registration does not imply a certain level of skill or training.