Long-Term Thinking Giving Founder-Led Companies an Edge in Volatile Markets: Insights from Michael Monaghan

Rally in tech giants driving stocks toward all-time highs and for now overlooking elevated energy costs fueled by the Iran war.

But beneath the surface, wholesale inflation is rising, pushing 30-year bond yields to 5% for the first time since 2007.

Now tech stocks are suddenly acting as a refuge for investors, which is a complete reversal from their history as pure risk.

Well joining us here at the New York Stock Exchange to explain why founder-led vision is the edge in today's volatile.

Market is Michael Monaghan, Partner & Portfolio Manager at Founder ETFs.

Michael, good morning.

Great to have you here.

Thank you so much for joining me.

Great to be here.

Thanks for having us.

Well ahead of the market open, we are looking at Dow futures set to rally by about 400 points, but there's a lot happening here, especially geopolitically.

So tell us why you think founder-led companies have the edge right now.

So founders think for the very long term.

They set a vision.

And they execute to build generational mission driven companies and that tends to do well when there's uncertainty because they're thinking for the long term and moving through any near term noise.

And do you think that is a double edged sword at the same time?

The data says it's been a positive attribute, and we haven't seen the double-edged nature of it.

Look at the data.

We've looked at 11,000 stocks over 30 years, and if you look at them on average they outperform the broader market by about 4%.

Yeah, and it's interesting that you're here at a time when we are watching the US president as well as China's Xi Jinping meet in Beijing.

So there's a lot happening below the surface, especially when it comes to technology as well as national security.

So what do you make of some of the leaders from these US tech companies also going abroad to China?

So we think it's very positive.

We probably lean to more of a cooperation posture than a pure competition posture.

And so to see the positive news coming out, for example, that Nvidia will retain their global lead and I think they're now going to be selling their H200 chips into China, I think it's good as we expand our markets and see how this cooperation can benefit the American worker, the American company.

And when we take a look at what's driving the S&P 500 higher in terms of sector, we're looking at energy leading the path up and followed by IT.

So given the volatility we've seen.

So far in 2026, give us your take on what American investors should be focusing on right now and why.

So we like to focus on the long term, but I want to identify three waves we see moving through the market so investors can watch them.

Wave one is the Middle East instability and the associated energy prices inflation.

Wave two is the CPE super cycle spend with the build out of the hyper scales, and wave three is concerns on job destruction.

So those 3 things will be influencing the market as we saw at the beginning of the week we had elation and some of the Middle East and inflation came back on on Tuesday, we backed off on some of that elation and we think we'll see those waves moving in and out of the market this year and when we zoom in on what's happening in terms of artificial intelligence, how dangerous do you think it is for investors right now to be actually chasing this chip rally and why?

So again, we wouldn't suggest chasing any specific sector of the market.

That's why we're invested across the broad market, but we think there's a lot of room to run.

The paybacks on these data centers are very fast.

Remember, Elon just leased his colossus facility to Anthropic for $6 billion.

So we think that.

The super cycle the spending will continue to grow at least in the near term and of course all of us are keeping our eyes on in video earnings and one of the last of the 7 names to report their quarterly results as well as guidance but we're talking.

Artificial intelligence, it is an ecosystem.

So what areas within that ecosystem are you most bullish on right now?

We're actually most bullish on a sector that had the multiples compressed.

We're very bullish on enterprise software.

We think that the multiple compression.

And the impairment to potential terminal values was overdone and we think that AI is going to require more enterprise software, not less, as it's the trust is in point into the corporates and this week has also been a big week for economic data and we know that consumers are paying attention to what's happening both on the inflation front as well as the labor market.

So what do you make of the latest data points here and what are the implications for rates.

So I think that we continue to see a hot running economy from an inflation perspective, so I think we may see rates held steady for a bit more, but I think the growth in the markets supports that.

And what are the implications here for some of the big tech names and why as far as inflation or as far as the cycle.

So on the inflation side, you know, big tech spend has typically helped with productivity.

Productivity can help with inflation.

So again we're positive on we think that we have we don't think we're overheated, but we don't necessarily see a rate cut coming and we think we're going to continue to see strong growth within enterprise tech and you pay attention to the space, so I do want to get your take on some of the announcements that are coming out from the companies, in particular in terms of layoffs due to AI.

So based on the data that you're actually looking at what are you seeing beneath the surface.

So we certainly are seeing some optimization at the companies.

We tend to think that it's not just AI.

Some of these companies have typically run a little overhired, and so AI is perhaps the excuse to right size.

We're constructive, as I mentioned, it's one of the three ways of watching what's going on with jobs, but we're constructive.

If we think about all.

All of the major innovations, whether it's the steam engine, electricity, they all reduced some jobs, but there's new jobs created.

For example, the iPhone reduced about 30 categories from camera to calculator, but we got ride sharing, we got delivery apps, we got mobile payments.

So jobs will be taken out of the economy, but new ones we're not even envisioning will be brought in.

Well, Michael, it was great having you on the show this morning.

Thank you so much for joining us and thank you so much for sharing all of your insights.

Great, thanks for having us.

Glad to be here.