In September 2020, investor and market analyst Roger McNamee made headlines selling a huge chunk of his tech shares of various companies such as Apple, Amazon, PayPal, and eBay. But why did Mcnamee sell his shares of companies that are currently seeing a rise in value? And could this decision affect his net worth?

Who is Roger McNamee?

Moonalice guitarist Roger McNamee is known in the investing markets as the co-founder of now-deformed Elevation Partners, which was also invested by Rock musician Bono —was a well-known private-equity venture fund in the US that invested in entities such as Facebook and Yelp before their existence in the stock market.

The $1.9 billion private equity-fund last portfolio company was sold in 2015 with its partner making investments in various companies such as Airbnb, Uber, and Sonos, among many others.

Roger McNamee sells Shares from Various Tech Companies

Appearing on CNBC News in early September 2020, McNamee revealed that he sold nearly 70% of his shares in Apple in August.

In addition to that, he said that he had sold nearly half of the stocks he had in around 20 other tech companies.

Why did McNamee sell His Stocks?

On 31 August 2020, CNBC quoted McNamee in its article reporting about the effect of the Tesla and Apple stock splits. McNamee was one of the market analysis whose perspectives was highlighted in the report. 

The tech and portfolio investor commented that he decided to decrease investments after analyzing the stock splits and the stock market’s momentum.

I look at the market. I look at the stock split. I realize there’s a lot of momentum here. And you never know when the momentum’s going to end, and I’m not trying to make a call on that issue. I’m just saying that, for me, this is enough. It’s been a great ride...

Then, he clarified that it was not just stocks of one company that he was selling. He was selling stocks from everywhere.

...And it’s not just Apple that I’ve been selling. I’m looking broadly through my tech portfolio — and I own a bunch of names — and I have been reducing positions across the board simply because I want to reduce the level of risk I’m taking in the market. I’ve had a year in the market that’s been truly extraordinary, notwithstanding what I think is demonstrably the worst year of reality of my lifetime...

During the interview with CNBC in September, Roger reiterated his reasons for selling these big tech companies’ shares. McNamee, 64, as of 2020, said that it was a personal risk-benefit calculation at his age.

...At my age, with my outlook in terms of my willingness to try to work hard to earn back anything I lose, I just didn’t want to take a huge amount of risk...

Then, he went on to imply that the nature of the market then was speculative at best...

...What I perceived going on in the market was that we were having a speculative blow-off...

Further, he also confessed that he was comfortable having just pure cash instead of shares for the time being until the stock market gets back to being normal again.

...For me, it felt like the risk was too high and I would rather have dead money in t-bills while things sort out...

McNamee also laid out a few reasons as to why he thought the market had a blow-off. He pointed to the COVID pandemic, US’s degrading relations with China, the election situation, the possible tax-raise in the next presidential term, and the possibility of more tech regulation in the future.

Roger McNamee’s Net Worth Likely to Remain Static this year & the Next 

Although Roger Mcnamee’s total net worth figure remains undisclosed, it is a fact that he is one of the veteran investors in Silicon Valley who had been enjoying the returns of his investment portfolios before the Covid-19 slowed down the American stock markets.

Either way, his decision to sell the huge chunks of his big tech companies’ stocks means that he has to find other lucrative investment portfolios to grow his net worth at a stable rate organically. 

However, it is highly unlikely that anyone can make a quick return in the current market with constantly fluctuating shares values without taking a huge amount of risks, as McNamee said. 

If the Albany, New York native is right, then the US tech companies will see a rapid fall in their stock values over the near future. If that happens, the investor will be glad to have withdrawn money from the market since stock values rapid downfall in the kong-run ordinarily results in substantial financial losses.

However, his analysis of how the market will play out in the future seems to contradict the analysis of the majority of investors out there.

According to a survey by DataTrek conducted in July or August of 2020, tech stocks are not in a bubble and are unlikely to drop value in the future. 70% of the investors who took part in the survey feel that tech stocks will rise in value by 5% over the next 12 months.

If this turns out to be accurate, then McNamee’s decision to withdraw huge portions of his stock investments would mean that he made a wrong investment decision. But as he says, he will not take risks because of his age factor, which’s important too.