S&P 500: Don't just 'chase the momentum,' strategist says

Multiple financial firms have raised their target goals for the S&P 500 (^GSPC) with Evercore ISI going as far as raising their target from 4,750 to a record-breaking 6,000.

Roth MKM Partners Chief Economist and Macro Strategist Michael Darda joins Market Domination to give insight into the bullish sentiments behind the S&P 500 and what investors need to keep in mind.

When asked about the implications of these new year-end targets, Dard states: "We have to be very careful about just chasing the momentum here. There's an old Bob Farrell quote that parabolically rising markets 'do not correct by going sideways.' And so it's very unlikely when you're in a frenzy like this with a lot of chasing, that it just simply peters out and levels off. And so my advice would be not to get involved in a chase, not to be using leverage. And then really just the basics, diversify. Maybe look at some areas that have been laggards all within the context of putting together a multi-year portfolio."

For more expert insight and the latest market action, click here to watch this full episode of Market Domination.

This post was written by Nicholas Jacobino