Could the market's most popular trades also be its biggest risk? @jam_croissant explains why crowded bullish positions can become vulnerable, even when the economic outlook remains positive. #StockMarket# #MarketVolatility# #RiskManagement# #Investing#

Market volatility in much of 2026 has been driven by uncertainty over AI-driven disruption. Whole industries have been sold off over fears AI tools will replace their business model, leading to a sharp divide between perceived “AI Winners” and “AI Losers”. We believe this short-term perspective overlooks long-term investment opportunities in both groups. Our latest In Depth research examines the industries being reshaped by AI. We explain why AI winners may offer more growth potential than widely perceived and why select AI losers may possess overlooked competitive strengths that could support long-term outperformance. -- 𝐑𝐢𝐬𝐤𝐬: All investments are subject to risk and may lose value. The discussion of market trends is not intended as advice to any person regarding the advisability of investing in any particular security. The views expressed in this document reflect those of the respective writer. Some of our comments are based on management expectations and are considered “forward-looking statements.” Actual future results, however, may prove to be different from our expectations. Our views are a reflection of our best judgment at the time and are subject to change at any time based on market and other conditions and Baron has no obligation to update them. BAMCO, Inc. is an investment adviser registered with the U.S. Securities and Exchange Commission (SEC). Baron Capital, Inc. is a broker-dealer registered with the SEC and member of the Financial Industry Regulatory Authority, Inc. (FINRA). ©2026 Baron Capital. All rights reserved.

The market is consolidating before its next big move. On Tuesday, the S&P 500’s intraday trading range was just 0.46%, near its lowest since December. For most of this month, the index’s intraday trading range has not exceeded 0.75%. Since the beginning of the month, this indicator has surpassed 1.00% in only 2 sessions, on August 3rd and August 4th. This makes August the least volatile month so far in 2026, based on this metric. Meanwhile, the volatility index, $VIX, is trading below 17 points for the 3rd consecutive week, the longest such streak since the final 2 weeks of 2025 and the first week of this year. Market volatility has been historically low this month.

YARDENI SEES UPCOMING MARKET SELLOFFS AS BUYING OPPORTUNITIES Ed Yardeni expects further market volatility but remains bullish on U.S. equities, citing strong earnings and economic fundamentals. Key risks include geopolitical escalation, Fed rate hikes, midterm election uncertainty and AI investment concerns. Yardeni targets the S&P 500 at 7,900 by year-end and 8,400 by mid-2027, supported by projected 2027 earnings of $425 per share.

US equity and bond market volatility are moving in opposite directions: The Volatility Index, $VIX, to MOVE Index ratio is down to 0.15, its lowest since December 2014. This ratio has fallen -31.5% over the last 2 weeks as the Treasury market volatility intensified. Over this period, the MOVE Index has surged +25.9 points, or +32.1%, to 106.6, its highest since March 31st. At the same time, $VIX has declined -1.7 points, or -9.5%, to 16.0, well below its 2026 average of 18.3. To put this into perspective, during the March to April 2025 correction and the March 2026 pullback, this ratio jumped to 0.37 and 0.36, respectively, as equity volatility followed the surge in bond volatility. Is stock market volatility set to follow again this time?