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Skip NavigationMarketsBusinessInvestingTechPolitics & PolicyVideoWatchlistInvesting ClubPROLivestreamMenuThings could get rocky for stocks near term, and investors should keep enough cash on hand to ride out the bumps, according to Goldman Sachs. London-based strategist Christian Mueller-Glissmann is recommending investors stay overweight stocks for the next three- and 12 months as corporate earnings stay strong and interest rates stabilize. But he also advised clients to remain overweight cash for the next three months. The strategist said, “AI concerns, midterm elections and Middle East tensions could drive more volatility with a limited buffer from bonds.” Equities have struggled lately, with the S & P 500 down 2.4% over the past month as concerns grow about the sustainability of the artificial intelligence trade. AI stalwarts Nvidia , Meta Platforms and Alphabet are all down more than 10% in that time. The Roundhill Memory ETF (DRAM) has plunged 25% over the past month. .NDX YTD bar NDX in correction territory Those declines have pushed the tech-heavy Nasdaq-100 index into a correction, down more than 10% from a record closing high set Oct. 6. On Friday alone, the benchmark tumbled 3.5%, its biggest one-day slide since June 5. “AI risk has dominated cyclical risk,” wrote Mueller-Glissmann. “Unlike the summer momentum sell-off, when semiconductors led the ‘risk off’, last week Hyperscaler implied [volatility] increased around results before resetting.” Mueller-Glissmann pointed to three factors that could drive risk appetite higher: “(1) easing AI concerns with more evidence on monetization, (2) rates relief, potentially helped by falling energy prices and easing Middle East tensions and (3) a larger decline of our [risk appetite indicator] below -1, improving asymmetry to add risk into year-end.” Goldman’s risk appetite indicator fell to -0.5 on Friday.Read More