The recent rout in tech stocks has sent many investors running for cover, but not everyone is retreating.
“As a trader and/or investor, it doesn’t matter,” Tom Sosnoff, founder of Tastytrade and current CEO of Lossdog, told Yahoo Finance’s Opening Bid. “That’s where you want to jump in.”
Sosnoff argued that when intense selling pressure arrives alongside spiked volatility, the market is signaling “capitulation” — the point where the last of the weak hands finally give up.
It is a philosophy that flies in the face of the fear gripping a generation of investors who, until recently, had only known an upward-trending market. Tech stocks, the undisputed darlings of Wall Street, are facing a brutal reckoning. A toxic cocktail of sticky interest rates, slowing growth concerns, and lofty valuations has triggered sharp pullbacks. Though the 2026 outlook is not uniformly dire, it does leave the sector looking more vulnerable than it has in years.
High-flying tech players have seen share prices plummet by double-digit percentages, with some losing 40% or more of their value in just a few months. However, for a self-proclaimed contrarian like Sosnoff, these steep declines transform “hyped and overpriced” stocks into “interesting” propositions.
“I don’t understand where the pressure is coming from,” he said, echoing the confusion shared by Nvidia (NVDA) CEO Jensen Huang regarding the sector’s violent swings. Instead of trying to time the absolute bottom, Sosnoff said the key to navigating this environment isn’t to chase every dip, but to focus on liquidity.
“Don’t get involved in stuff that doesn’t have liquidity,” he advised. “If it has liquidity, sure, you can nibble anywhere.”
If a stock maintains high trading volume despite a price drop, traders can enter and exit positions without getting trapped, effectively reducing the risk of a total wipeout, Sosnoff noted.
Among the areas catching Sosnoff’s eye is fintech, where companies that were once priced for perfection now offer compelling, if risky, entry points. He points to Robinhood (HOOD) as a prime example of a highly liquid stock that has become “really cheap.” While Robinhood has been slammed recently — hit by a double whammy of a crypto sell-off and seasonal dips in its prediction markets — Sosnoff views it as a prime candidate for a “nibble” due to its volume and growth profile.
Even established yet often-overlooked tech giants are entering the “interesting” zone. Sosnoff highlighted Oracle (ORCL), a company he admits he doesn’t “even like to buy.” Despite its cloud momentum, the stock has retreated roughly 40% from its 52-week high. This, however, illustrates his broader view that extreme market corrections can create value in unexpected places, forcing even reluctant investors to take a second look at legacy names.
Sosnoff also offered a skeptical take on the pervasive narrative that AI will inevitably disrupt existing software companies into obsolescence. While many fear that companies not fully dedicated to AI will be left behind, he believes the integration challenge is vastly overstated.
“It’s pretty easy as a software company to embed a lot of the new AI tools and functionality and all the features,” he explained, noting that the transition is “relatively cheap to do … and it doesn’t have a long lead time.”
This suggests that the current pressure on software stocks stems more from a valuation reset than a genuine inability to adapt to new technologies. “I just think that [it’s about] full integration, that’s how we’re addressing it,” Sosnoff said of his own software ventures.
His final advice for investors willing to look past the flashy headlines is to stop fearing the roller coaster and start embracing the volatility. For a contrarian, a downturn isn’t a crisis — it’s the time when the market puts its best assets on sale.
Francisco Velasquez is a Reporter at Yahoo Finance. Follow him on LinkedIn, X, and Instagram. Story tips? Email him at francisco.velasquez@yahooinc.com.
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