Barchart @Barchart · 3h Japanese Stocks Hit 34-Year High 🚨 For the first time in 34 years, the Nikkei jumped above 37,000. The index is now about 5% away from taking out the all-time high set all the way back in December 1989.
Warren Buffet took over Berkshire Hathaway in mid-1960s. Anyone want to guess how much it is up since then?
A whopping almost 5 MILLION%. I think most people would take that return.
There are about 3,600 companies in the NASDAQ Composite. The MAG 7 accounts for about half of the total market cap for that index.
'Having added nearly Tesla's entire market cap in the past two months alone, Nvidia is worth $1.74 trillion, just shy of Amazon at $1.77 trillion. Alphabet, the third most valuable US company, isn't too far away at $1.83 trillion.' https://t.co/hJHBsXROmnpic.twitter.com/CoRoP17922
My first laptop was from Microelectronics (MUEI), a sister company to Micron. iVillage (IVIL), like Pets was one of the last to come public, shot up for a bit before rolling over. I believe that was the summer of 2000. I had a client who bought it the first day, went to Europe on a vacation, came back it was toast.
Not surprised to learn you were giving bad investment advice in 2000 also. Some things never change.
I sold around a quarter of my tech fund and put it into short term junk bonds.
I'm not worried about the economy so the junk should be fine. It'll get its 7% and maybe more if rates fall.
I'm not happy being on this giant wave of money into tech. But I never short anything.
I have a number I am willing to commit to the trade. Once reached I will sell into continued market strength, possibly aggressively. This is a trade, but does express my view the AI hype has gone pretty far.
come on. This is stupid. probably time to take some profits.
I posted this on 12/28/23, about 6 weeks ago:
"I heard that the individual investors as a class have been reluctant to get back in, and this is probably attributable to getting burned and the availability of other lucrative investment opportunities, like bonds and HYSA. My bet is that this will gradually change and give strength to yet more gains in the market and Nasdaq."
It is starting to feel like we are getting pretty far extended, but I'm still hanging tight. And the fact is, steadily buying each day as the market continues to hold its gains.
Earnings Scorecard: For Q4 2023 (with 67% of S&P 500 companies reporting actual results), 75% of S&P 500 companies have reported a positive EPS surprise and 65% of S&P 500 companies have reported a positive revenue surprise.
Ryan Detrick, CMT @RyanDetrick · 3m The S&P 500 is up 14 of the past 15 weeks and up more than 20% the past 15 weeks. In the history of the stock market that has NEVER happened before.
Ryan Detrick, CMT @RyanDetrick · 3m The S&P 500 is up 14 of the past 15 weeks and up more than 20% the past 15 weeks. In the history of the stock market that has NEVER happened before.
But what a head-fake we were thrown in the first week or so of the new year for the Nasdaq., and tech. even more than that Remember? Big selling to start the year, like it was over or something.
Nasdaq dropped about 3% that first week but has found solid footing since then, to say the least.
I wrote a few months ago that I think the current AI surge has some legs and is likely to run for something like the next 1 to 5 years, as a guess, before popping. There's likely very good money to be made. That said, one the bubble pops - and it WILL eventually pop - who knows how hard or how long the aftereffects will be. If we look to the tech boom of the late 90s and subsequent crash in 2000, it took more than 15 years for tech to recover and about a dozen years for SP500 to regain its 2000 highs. I suspect this time the eventual tech reversal will have a bigger effect on the broader index since the high flying tech stocks are making up such a large fraction of market weight, which will only increase as tech stocks soar.
I write this not to tell people not to invest in tech stocks, but rather simply to suggest people weigh the risks and design their portfolios accordingly.
I wrote a few months ago that I think the current AI surge has some legs and is likely to run for something like the next 1 to 5 years, as a guess, before popping. There's likely very good money to be made. That said, one the bubble pops - and it WILL eventually pop - who knows how hard or how long the aftereffects will be. If we look to the tech boom of the late 90s and subsequent crash in 2000, it took more than 15 years for tech to recover and about a dozen years for SP500 to regain its 2000 highs. I suspect this time the eventual tech reversal will have a bigger effect on the broader index since the high flying tech stocks are making up such a large fraction of market weight, which will only increase as tech stocks soar.
I write this not to tell people not to invest in tech stocks, but rather simply to suggest people weigh the risks and design their portfolios accordingly.
You made some good points but I think you are overlooking a huge thing - dividends. Sure, it took about 12 years for the S & P to regain its 2000 highs but you are only looking at its value and ignoring dividends and especially its reinvested dividends. Over about the last 100 years dividends have accounted for roughly 40% of the total return of the S & P.
The NASDAQ 100 was created in 1985. Over the past 38 years (since its inception) the NASDAQ 100 has generated an average return of 15 - 17% annually.
Here is the real kicker: If you look at the cumulative return of the NASDAQ 100 since inception it is 825%. But if you look at the cumulative return with dividends reinvested it is 15,000%.
Sally, you may be putting too much faith in dividends for the moment. The small number of massive cap stocks driving the current market rally tend to pay no, or at best very low, dividends. Again, I’m not trying to discourage anybody from anything, just trying to share some thoughts for consideration.
And to expand on that thought, the current dividend yield of the NASDAQ is 0.85% and on a declining trend. Further, current yield of the SP500 is below 1.5% and also on a declining trend, as is natural with massive cap tech stocks with no dividends growing their weight in the indices.
Buyer beware… 🙂
I think the secret to making money in the current tech-led surge will be in picking a good point to walk away. Or regularly rebalancing to reduce tech exposure and limit the eventual downside. Some investors / speculators will get lucky and make a fortune. Most of us, I think, will not.
And to expand on that thought, the current dividend yield of the NASDAQ is 0.85% and on a declining trend. Further, current yield of the SP500 is below 1.5% and also on a declining trend, as is natural with massive cap tech stocks with no dividends growing their weight in the indices.
Buyer beware… 🙂
I think the secret to making money in the current tech-led surge will be in picking a good point to walk away. Or regularly rebalancing to reduce tech exposure and limit the eventual downside. Some investors / speculators will get lucky and make a fortune. Most of us, I think, will not.
relying on dividends to bail investors out of hypothetical tech stock losses is not realistic, no.
But you mentioned that the SP500 took 10+ years to recover highs after the dot com bust. That index does pay more solid dividends and if they were reinvested, recovery from that bear market was faster.
Although now that the the SP500 is so heavily weighted in tech, it might recover even more slowly this time I suppose.
And look...if a portfolio has bonds in it, you are getting 4-7% from those. And if there is a recession you'll likely get even more total return. That should do quite a bit to cushion drops in stocks.
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