Paul Tudor Jones, the billionaire hedge fund legend known for calling the 1987 crash, is warning investors to prepare for a wild finish to the bull market. On CNBC's “Squawk Box,” Jones said all the ingredients are in place for a "blow off" rally, but cautioned it could end "really, really bad." History, he says, often rhymes, and today's tech-heavy market shows striking parallels to the late 1990s dotcom surge.
- Track the tech-heavy QQQ here.
History Rhymes, But The Setup Is Different
Jones sees echoes of the late-1990s rally in today's dramatic tech and AI stock gains. The difference this time? Fiscal and monetary policy. The U.S. is running a 6% budget deficit, which is already high compared to the 1999 surplus and easing of the economic cycle.
"That fiscal-monetary combination is a brew we haven't seen since the early postwar period," he said.
Investors should note Jones' timing advice: the largest price gains tend to come in the 12 months preceding a market top. "You have to get on and off the train pretty quick," he said.
Missing the early leg means leaving "juice" on the table, while staying on too long risks being caught in the collapse.
Where Jones Is Placing His Bets
Jones' Tudor Investment fund, with $13.2 billion under management, provides a window into where he expects this last leg of gains. His top five holdings by portfolio weight:
- S&P 500 ETF (NYSE:SPY) — 9.3%
- iShares Bitcoin Trust (NASDAQ:IBIT) — 2.1%
- Frontier Communications Parent Inc (NASDAQ:FYBR) — 1.2%
- Spirit AeroSystems Holdings Inc (NYSE:SPR) — 1.2%
- Apple Inc (NASDAQ:AAPL) — 1.1%
Several are tech and AI-related, highlighting his focus on innovation-driven sectors. Others, like SPY, reflect a bet on broad-market strength during the final bull surge.
Investor Takeaway
Jones' message is clear: the next phase could deliver extraordinary returns — but only for nimble investors. The "really, really bad end" he warns of underscores the need for discipline and timing.
Following his top holdings gives clues to where the market's final explosive gains may lie, but as always with Jones' forecasts, happy feet are required.
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