The Nasdaq’s 12% correction creates a rare entry point for long-term investors

The Nasdaq-100’s 12% drop from its peak has compressed tech valuations to levels not seen in months. For long-term investors, that creates a rare entry point. The S&P 500’s smaller 9% decline underscores the outsized impact of tech’s fall — a sector that makes up roughly 60% of the Nasdaq-100. That concentration is now working in buyers’ favor. When sentiment shifts, these positions fall hard. But history shows they also rebound hard. Investors who bought during the 2018 selloff and the 2020 crash were rewarded with strong gains within a year. The mechanism hasn’t changed. Geopolitical tensions and oil above $100 have added pressure, but they haven’t altered the long-term trajectory of dominant tech firms. Vanguard’s Information Technology ETF, now at lower multiples, offers direct exposure. For those wary of timing the bottom, dollar-cost averaging into diversified Vanguard ETFs spreads risk across weeks or months. The worst of the selloff may be behind us — breadth has improved, and non-Magnificent Seven stocks are holding up. Corrections are temporary. Compounding is not. Long-term investors who act with discipline now are positioned to benefit when recovery begins.