Lately, we've seen a risk-off mentality in the growth names, otherwise known as momentum (momo) names due to outrageous valuations. So, does that mean a correction is coming?
History does suggest that weakness in the growth names does portend for a re-assessment of current prices.
However, someone has to be buying the stock that the investors/traders are selling, right? So, for some, you can argue it's risk ON. And this is what makes the market: While some do find risk in these names, there are others who are happy to add to or initiate positions in names that are down 15 percent to 50 percent. And that is the key: These same buyers today were not interested in adding to or initiating positions in these names at higher prices - they were, in fact, TOO risky. But after the sale, they become a bit more interesting.