Buying stocks when markets are at all-time highs can be a confusing proposition.
On the one hand, doing so goes against the most basic of investing tips, “Buy Low, Sell High.” And with the S&P 500 trading at its highest price-to-earnings ratio (29.7) since the pandemic crash, “buying low” could present a challenge. Further complicating matters is the upcoming second-quarter earnings season, which has relatively high expectations already baked in.
On the other hand, buying stocks when momentum—and charts—are on your side is typically a profitable proposition, after all, momentum begets momentum. As we like to say at Cabot, trends always last longer than most people expect. And right now, the trend in the stock market is up.
So, what’s an individual investor like yourself to do? Here are a few words of wisdom our investing experts have been sharing with their subscribers of late.
Our Experts on Buying Stocks at All-Time Highs
Chris Preston, Chief Analyst, Cabot Stock of the Week and Cabot Value Investor
“Now, on to the market. It’s at all-time highs! Did I think that was going to be the case two weeks ago when the U.S. had just bombed Iran’s nuclear facilities and it appeared a major war was in the offing? No. But the tensions de-escalated as quickly as they escalated, and Wall Street has taken that as a green light to buy stocks again after a month or so of mostly sideways action.
“Suddenly, the S&P 500 is up 5% through the first half of the year – which is pretty normal historically. Stocks have truly been climbing the ‘Wall of Worry’ of late, and it’s a good reminder that headlines don’t matter, charts do. And for all of 2025’s ups and downs, stocks have continued to rise, and the bull market is very much intact.”
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Mike Cintolo, Chief Analyst, Cabot Growth Investor and Cabot Top Ten Trader
“We’re firmly in the summertime at this point, but nothing’s changed with the market from a top-down point of view: It’s bullish, with the intermediate- and (for the big-cap indexes anyway) longer-term trends pointed up, and now we’re seeing new highs expanding as more stocks join the parade, which is all to the good.
“Indeed, our biggest conviction remains the overall market, with numerous bullish breadcrumbs pointing to nicely higher prices in the months to come. Individual stocks remain trickier, as we saw some rotation out of growth and into some other areas last week—if leaders decisively crack, that could be bearish, but to this point, the action has mostly served to broaden the advance, which is a good thing.
“Of course, earnings season is dead ahead and trade headlines have started to come out this week; throw in a bit of short-term giddiness and we wouldn’t be shocked to see some ups and downs. But, all in all, we’re following the positive evidence.”
Tom Hutchinson, Chief Analyst, Cabot Dividend Investor and Cabot Income Advisor
“Uncertainty is growing in a market perched near the high.
“Tariffs are front and center again. The July 9 deadline, which began the market rally from the low when the administration issued a 90-day extension, is rapidly approaching. The deadline raises many of the issues the market hated back in April. Stocks started the week on a down note in anticipation.
“While there is certainly a possibility of a negative market reaction, the news could be seen as positive as well. There could be several last-minute deals announced, and the administration is already hinting about extending the deadline again to August for many countries. Investors seem to like procrastination.
“It’s hard to tell where stocks will go amid the renewed tariff headlines. On the one hand, the threat of tariffs plunged stocks to the cusp of a bear market in April. On the other hand, stocks managed to rally to a new high while tariff uncertainty is still floating around.
“In venturing a guess, I would say it is more likely that the market takes this week’s news as positive. It is a consensus view that tariffs won’t be some kind of disaster, a view that was not widely held in April. It’s also likely that this week’s news is a combination of new deals and delays. But you never know. And the market is near the high.
“I’m still taking a cautious approach. Even if the trend is positive, it may not be nearly as positive with stocks near the high as it was when stocks were near the low.”
Clif Droke, Chief Analyst, Cabot Turnaround Letter
“July is here, and with its onset, we’re seeing the early stages of what looks like a classic summer rally. Granted, the perceived inevitability of the summer stock market climb is something of a myth—the summer months being just as much subject to potential selling pressures as any other time of the year—but there’s at least a ring of truth to that bromide.
“Not that rallies are guaranteed in the summer months, but because trading volumes tend to be lighter when participants are on vacation, it’s easier for buyers to push stocks higher during the laid-back summer milieu. That is, of course, assuming liquidity is abundant and the sentiment backdrop isn’t too frothy.
“Thankfully, liquidity isn’t an overriding concern right now. And with investors still psychologically recovering from the shock of the recent tariff war’s early stages, market sentiment is also supportive. So, it’s not surprising to see equities on the move higher as we head into the vacation season’s ‘sweet spot.’
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“For now, the market remains in good shape based on the indicators I look at, with internal strength still evident, liquidity abundant and market sentiment supportive (from a contrarian perspective). I’m bullish, but I’m also prepared to shift my market stance should the negative variables [of tariffs, European layoffs and European port congestion] turn out to be more problematic than anticipated.”
Conclusion: You Should Be Buying Stocks
While our four experts acknowledge that the market has entered some tenuous territory, every single one of them still recommends buying stocks.
The bull market remains in full effect, and when viewed on a 15- to 20-year chart, doesn’t actually look that overdone. Despite the big run-up since April and valuations at multi-year highs, there isn’t enough evidence to preemptively start selling stocks in anticipation of a market crash that may or may not happen.
Of course, you should watch whatever stocks you do buy closely. But when isn’t that the case?
If you’d like some help deciding which stocks to buy with markets at all-time highs, you can subscribe to any one of our investment advisories by clicking here.
In the meantime, don’t run from this bull market. Embrace it—at least until our experts tell you otherwise!
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