Perhaps we should ask AI? Ahahah
Key figures on AI's impact:
-75% of S&P 500 gains: Since the launch of ChatGPT in November 2022, AI-related stocks drove 75% of the gains in the S&P 500, according to a September 2025 analysis by JPMorgan.
-60% of 2025 market returns: In 2025, approximately 60% of market returns were attributed to AI-related stocks.
-Dominance of the "Magnificent Seven": Much of this growth is tied to a handful of companies, including Alphabet, Amazon, Apple, Meta, Microsoft, NVIDIA, and Tesla.
-Through the first three quarters of 2025, this group added $3.1 trillion in market capitalization.
-Sector-specific outperformance: A Morningstar analysis showed that a basket of 38 AI stocks significantly outperformed the overall market in the third quarter of 2025, gaining 15.7% compared to the market's 7.7% return.
I don't know about you guys, but I am not feeling any better after reading that! If true, this bubble has been forming for 3 years already. And is highly focused on the usual suspects.

DD is per month, not daily, and why it's not accurate.
QDSIX is far from the bond category. It lost about 7-8% this year from peak to trough and in 2024.
I would rather invest in QLEIX, it lost about the same in 2025, and 2024.
In the last 3 years QLEIX made 128%...QDSIX only made 85%.
Sharpe: QLEIX=2.8...QLEIX=1.2
Both should not be compared to bonds.
Earlier market tests do not guarantee future results. Many select only funds with many years of history and miss relatively great risk/reward in the last 3-6-12 months.
That's fine; leave the small AUM for me and jump in after the best 3-5 years since inception. :-)

I don’t know. Many are making a case for the affirmative. (Here’s one.) The problem is that you can be “right” and yet early by several years. So, often skeptics end up looking like idiots six months or a year later.
I’ve been searching in vain for Vanguard’s warning to its investors about excessive valuations made in the late 90s. The most memorable line was: “… trees don’t grow to the sky.” It received a lot of attention across the investment community back then. The markets continued to soar. I did uncover Fed Chair Alan Greenspan’s famous “irrational exuberance” remark from December 1996. Market impact lasted for a day or two. For perspective on the then looming catastrophe, in less than a decade (1995-2002) the NASDAQ rose 600% and then lost 78% of its value. Thrills and chills.
Aside - Can’t help wondering how Fed Chair Alan Greenspan might have dealt with the kind of attacks on him personally and on the institution we have witnessed recently. My bet is he wouldn’t have taken it lying down.

AI for hard science may lead once we are far (years) past trough of standard hype cycle.
experts disillusioned elsewhere (e.g., toxic media,defense,finance) join Applied Minds and such companies.
as for current bubble , see nobel prize skeptic from mit, and this :
https://slate.com/podcasts/what-next-tbd/2025/09/artificial-intelligence-isnt-a-viable-business-but-investors-are-acting-like-it-is

Barron’s Funds Quarterly+ (2025/Q3–October 6, 2025)
https://www.barrons.com/topics/mutual-funds-quarterly
(Performance data quoted in this Supplement are for 2025/Q3 and YTD to 9/30/25)
Stocks of FUND ASSET MANAGERs have languished: BlackRock (BLK; yield 1.8%; fwd P/E 23.6; #1 by AUM), Invesco (IVZ; yield 3.7%; fwd P/E 10.9), T Rowe Price (TROW; yield 5.0%; fwd P/E 10.6); Franklin/BEN is mentioned; private Vanguard is also mentioned and it now has 50% of the fund industry assets (excluding money-market funds). The fund industry is changing and growing overall. The most problematic are active mutual funds/OEFs but the mutual fund category (passive and active) hasn’t been growing. Mutual funds flourished during the baby-boomers era but now they are in retirement-decumulation phase.
New growth is in ETFs/ETPs, ETF classes of funds, retirement TDFs (soon to include alternatives), interval-funds (IFs), alternatives (cryptos, private-equity/credit) (other developments have been in CITs and guaranteed-income options within 401k that involve partnerships between fund firms and insurers). These listed asset managers are also adjusting to this new environment and should do well long-term. Goldman Sachs/GS is investing $1 billion in TROW to develop Price TDFs with some GS alternatives.
QUARTERLY REVIEW. WINNER – gold-miners. High gold prices finally kicked into the bottom lines of gold-miners and they have rallied furiously. Mentioned are gold-miners GDX, GDXJ, SGGDX, OPGSX; gold-bullion GLD; silver-miners SLV (gold:silver ratio recently peaked at 105 in 04/2025 and is currently around 82).
RUNNER-Ups – China region funds and digital assets (cryptos). In a boost to cryptos, stablecoins became mainstream through GENIUS Act.
Ironically, many mainstream investors stayed away from these highflying categories. Among the traditional fund categories, the best was large-cap-growth. LC-blend SP500 easily outperformed bonds. Inflows into ETFs (passive, active) were strong. Outflows from OEFs continued. But some unusual observations: (i) strong inflows into money-market funds despite the expectations of lower rates (maybe the investors were derisking a bit), (ii) outflows from small-caps despite strong performance (investors getting out after years of frustration?), and (iii) weak inflows into foreign funds despite their strong outperformance vs US funds (weak dollar added to the performance of foreign funds). So, there was euphoria, but not extreme euphoria. (By @LewisBraham at MFO)
MFOP data for Q3 pending.
Top 5 Categories, Q3

Bottom 5 Categories, Q3

LINKs: Quarterly Digest1 Digest2
Accessible from Mutual Fund Observer (MFO).

Some of this has been mentioned in other threads here. What is somewhat surprising to me is how many are all starting to speak up. So, I thought this might deserve its own thread.
https://www.cnbc.com/2025/10/03/goldman-sachs-ceo-david-solomon-warns-stock-market-drawdown-is-coming.html
-Goldman Sachs CEO David Solomon said AI presented opportunities but that some investors were overlooking “things you should be skeptical about.”
-Speaking at Italian Tech Week in Turin, Italy, he said a “drawdown” was likely to hit stock markets in the coming two years.
-“I think that there will be a lot of capital that’s deployed that will turn out to not deliver returns,” he said.
“I wouldn’t be surprised if in the next 12 to 24 months, we see a drawdown with respect to equity markets ...and when that happens, people won’t feel good.”
Amazon founder Jeff Bezos said Friday that artificial intelligence is currently in an “industrial bubble.”
Karim Moussalem, chief investment officer of equities at Selwood Asset Management, meanwhile, warned of “enormous risks” on the horizon for the AI trade which could rapidly unravel. “The AI trade is beginning to resemble one of the great speculative manias of market history,”
Veteran investor Leon Cooperman told CNBC that we are in the late innings of a bull market where bubbles can form — something Warren Buffett had warned about.
Most believe there is money to be made, but that the euphoria may be overblown.

From Markets A.M. newsletter by Telis Demos.
On this day in 1913, President Woodrow Wilson enshrined into law a federal income tax,
less than 20 years after it was declared unconstitutional by the U.S. Supreme Court.
He signed the act after 9 p.m. to prevent anyone from hiding assets during that day's business hours.
The tax kicked in at 1% of all earned income over $2,500 for single taxpayers
and $3,333.35 for married couples.
Note: President Wilson was rightfully concerned about tax evasion in 1913.
Today, very wealthy individuals — with the assistance of shrewd tax attorneys and cunning accountants —
can take advantage of tax loopholes to avoid paying much (on a percentage basis) in taxes.

Have you looked at China funds recently? They are flying.
Ex-China indexes were driven by the Fed TSP change to exclude China from its foreign indexes. That has crept into general investing arena too.
But the timing for ex-China funds seems poor. BTW, Vanguard suddenly quit its China business some years ago - in those old days, it promoted China exposure.

From Markets A.M. newsletter by David Wainer.
On this day in 1990, the Japanese stock market had what was then its best day on record:
The Nikkei 225 index skyrocketed 13.2%.
Investors were euphoric over rumors the Japanese government would intervene
to stop the ongoing market crash.
Unfortunately, the rally turned out to be a "dead-cat bounce," and the Nikkei soon resumed falling.
Additional Notes: The Nikkei 225 index reached a record high in December 1989.
It was February 2024 before the index closed above its prior high — more than 34 years later!
The U.S. had the "lost decade" for the S&P 500 (2000 - 2009) but the Japanese "lost" more
than three decades with the Nikkei 225.
It was not a pleasurable experience for Japanese residents who invested mostly in domestic equities.

I got burned several years ago by NAV based on models. They probably work better for Interval funds, as the Company knows ahead of time about withdrawals and can limit them, but they are still guesses.
Remember IOFAX? NAV dropped 20% overnight!
In an another OEF I owned they changed the NAV after I sold it before Settlement Date. I complained to the SEC and got the difference restored. Good luck trying that now.

Holy Grail is the term I had in mind (at least for the last 5 years) but free lunch works too. Below is direct from the article.
However, at least in the case of CCLFX, which restricts investments to private credit that is senior, secured, and backed by private equity, the risk of stale pricing is minimal, and doesn’t even exist beyond a month from an economic and statistical significance viewpoint. The takeaway is that the volatility of CCLFX is somewhat understated somewhat when looking at one-month returns. However, when looking at volatility on a quarterly, or longer, basis that is not the case. The bottom line is that CCLFX provides investors with access to the credit premium and the illiquidity premium of private credit without being concerned about the risk of stale pricing. And for investors who don’t need liquidity for at least some portion of their portfolio the illiquidity premium is as close to a free lunch as one can find. Thus, one should eat as much of it as possible!
Full Disclosure: I own shares of CCLFX.
Larry Swedroe is the author or co-author of 18 books on investing. His latest is Enrich Your Future

On the topic of private credit, no idea how the next 5 years will pan out but the past 5 have been pretty amazing. As an example, CCLFX (large player in this space) returned 10.5% with a max dd of 0.2% (yep this is not a typo)

WAPSX. IS the min initial investment really 1M?

From my limited understanding, $1m is the default setting that Yahoo places on a fund record when it can't extract a min investment from the prospectus or fact sheet. Lol, I got in at $50k over 10 years ago and I really haven't paid much attention to the metrics since. I just let it grow and focused on the growth stuff for the past 10 years. Ask your broker what the actual min is..maybe it depends on in/out of IRA.
Yeah, 2022 was awful. Should've been more proactive. Getting better with MFO. ;)

PRWCX is underperforming VWELX for various time periods 3 months to 3 years. 5 and above it has outperformed VWELX
I hold a small position in TRAIX with the hope of scaling up if this fund starts firing again. Giroux has a great long term track record.
https://www.portfoliovisualizer.com/fund-performance?s=y&sl=4VSTgvOMP3SRfjVH0g4UM5

From Markets A.M. newsletter by Jinjoo Lee.
On this day in 1981, Uncle Sam issued new 20-year Treasury bonds at a 15.78% yield,
an all-time high rate for any U.S. government issue.
Analysts expected that yields would have to go higher “to attract stronger demand.”
Yields promptly began going down and do so for the next twelve years.

According to ETF.com, Vanguard did apply for an ETF class for an active fund around 2015, but it was rejected by SEC. Don't know what the reasons were.
"When Vanguard let that patent expire in May 2023, the filings to mimic the unique structure started piling up at the SEC, which has been mum on the topic since denying Vanguard’s request to extend the ETF share classes to actively managed mutual funds nine years ago."
https://www.etf.com/sections/news/whats-holdup-etf-share-classes
FWIW, Vanguard now also has filings for ETF classes of its active funds. SEC chose DFA filing to be the model for others to follow to this time, not Vanguard (actually, VG didn't share/license its previous patent (now expired) with ANYONE).

The Week in Charts (09/27/25)
The most important charts and themes in markets and investing...
00:00 Intro
00:19 Topics
01:09 The Fed Has an Inflation Problem
06:38 A Stronger US Consumer Lifting GDP
12:42 Powell on Stock Prices: "Fairly Highly Valued"
18:02 The New Home Discount
23:27 Gold Glitters, Silver Shines
26:33 Foreign Investors Still Buying American Stocks
28:34 150 Years of Human Progress
Video
Blog

The SEC provided notice today that it intends to allow Dimensional's mutual funds to offer ETF share classes.
Dimensional initially sought SEC approval two years ago.
Vanguard's patent for mutual fund ETF share classes which applied only to index funds expired May 2023.
It may take time before these new ETF share classes from Dimensional
(and other firms that filed for exemptive relief) come to market.
https://www.morningstar.com/funds/etf-share-classes-are-go-dimensional-heres-what-investors-need-know

If Irving Fisher said many years ago that stock prices have reached what looks like a permanently high plateau, he obviously was wrong.

Because the bond market is so fragmented, active bond ETFs have been around for years, while active equity ETFs is a relatively new development.

The real reason is simple: the S&P 500 is a powerful momentum-driven index, and U.S. markets have been leading the world. That makes it very hard to beat over several decades.
Bonds, on the other hand, are far less efficient. Their performance depends heavily on interest rates, which makes them far more vulnerable.