Tech is on the rise

by | Jun 5, 2018 | General

And for the right reasons

Technology stocks make up about 25% of the S&P 500, making it the market’s largest sector. The last time tech was so big was about 20 years ago, during the roaring dot-com mania. 

So is this a “here we go again” scenario?

No. Back then, everyone wanted tech stocks even though many of those companies never made any money. The excessive excitement was rightly called “irrational exuberance.” 

And now? The criticism leveled against tech companies is that they make too much money! And the fear of another market decline is making investors excessively pessimistic. 

Technology stocks used to be expensive with meager earnings. Not true today. 

We’re trying to keep an even keel. We see rising company earnings with reasonable valuations. In other words, right now is a normal scenario for markets. We should have normal long-term expectations—which for stocks is decidedly positive. 

Best regards,

Evan McGoff

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