Buying Peloton and similar growth stocks is 'absolute nonsense,' says strategist

High-growth tech stocks are unlikely to rebound after a "pivot" on interest rates from the Federal Reserve, according to one market strategist. Peter Toogood, chief investment officer at investment platform Embark Group, said a change in interest rate strategy by the U.S. central bank will indicate the economy had taken a turn for the worse, which will send "profitless growth stocks" crashing even further.

The ARK Innovation ETF , which currently holds shares in about 30 mostly profitless companies chasing "disruptive innovation," is down by more than 65% this year. The fund, run by Cathie Wood, doubled in value from its pre-pandemic levels last year but has now given up all of those gains. Wood has attracted criticism from a range of value investors for the fund's lackluster performance, including Toogood.

What about buying stocks that have no long term debt and ever increasing free cash flow? Is that absolute nonsense as well?

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