Markets stocks

‘Parabolic’ Tech And The ‘Good’ Idea Misnomer

Too often, we conflate getting in lower than the next person in a "greater fool" market with making a "good" decision.

Too often, we conflate getting in lower than the next person in a "greater fool" market with making a "good" decision.
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1 comment on “‘Parabolic’ Tech And The ‘Good’ Idea Misnomer

  1. Point is excellent.

    Amazon is still about 10% below all time highs. Their “parabolic” move happened a while ago. But at least they innovate, invest and have 2 huge markets in web services and advertising. Though interesting the need to advertise AWS all the time now (not a good sign to me) and they delivery skills are terribly inefficient. Count how many different AMZN delivery trucks pass your house on any given day.

    AAPL is very different. Boring, lagging consumer product company with little innovation really (imo) and lots of financial engineering.

    Then GOOGL, again, massive innovation and investment. A core business cash cow that will have to hand over the hard work to the new or newer businesses.

    The utility stocks like a WEC (or bonds – corp or govvie) that trade at ridiculous valuations for no innovation.

    30% of the SP500 is probably in secular decline.

    A lot of bad decisions being made every day. Not sure tech is the only poster child. In a world where everything is absolutely overvalued some tech may not be as egregious as other areas.

    I get the whole parabolic move is disconcerting and I sure have sold a lot of these names (though haven’t owned AAPL the last 90 points) but when I look for opportunities there are so few that one almost ends up in these as they are some of the few actually innovating and investing.

    AAPL, MSFT, GOOGL, AMZN and FB are almost 20% of the SP500 so every indexer is making the same “decision”.

    Not recommending any trades, just want folks to think about things more.

    Great piece H.

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