Justin Lahart wrote a fascinating article in The Wall Street Journal about tech titans.
Picture the scene on March 10th, 2000. It was 19 years ago at the very height of the dot com bubble. On that date, the Nasdaq hit a high that it wouldn’t eclipse for 15 years.
The four tech titans of that era were Microsoft, Cisco, Intel, and Oracle. They were sometimes called, “the Four Horseman” and they accounted for about 13.9% of the S&P 500’s market capitalization.
Do you remember those days? It seemed like everybody owned Intel and Cisco. Larry Ellison of Oracle was on TV every day. Everybody owned Microsoft since its IPO, or so they claimed. It’s hard to forget those days.
Microsoft, which is currently either the first or second largest company in the world by market cap, is the only one of those four companies that is worth more now than it was 19 years ago. You read that right.
Those other three companies are still in existence, and are worth less than they were 19 years ago. Somebody who bought one of those three stocks on March 10th, 2000, probably thought they picked a great investment. It hasn’t happened yet.
We don’t buy individual stocks for our clients. There are lot of reasons why and that’s clearly one of them. So if you think one of the FAANG stocks, which are our current tech titans, is a can’t miss opportunity, please learn from the past.
My name is Mike Garry, and my company is Yardley Wealth Management. We are a fiduciary, fee-only financial planning, and wealth management firm in Newtown, Pennsylvania. (That’s in Bucks County). If you’d like to talk about this or anything else, please reach out: 267-573-1019, firstname.lastname@example.org or @michaeljgarry
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