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This is a classic example of simpson's paradox. Market's across the board are doing pretty bad this month - It would be interesting to how bad tech is doing re

This is a classic example of simpson's paradox. Market's across the board are doing pretty bad this month - It would be interesting to how bad tech is doing relatively to oil futures and other commodities.

pc86 11y ago
Why is it important how tech is doing relative to other unrelated markets? Edit: I don't know why I'm being downvoted for asking a question. I've many times seen a stock sector performance chart (I don't know the technical name) with most of the market red and tech lit up bright green.
- hibikir 11y ago
  Because all markets are really related in some ways, and you can't judge performance without looking at alternatives. Sometimes, a sector goes down, or up, by itself, and then we can expect that the reason for the price change has something to do with that sector. The same thing happens when looking at companies: If Home Depot is down 3% but Lowes is also down 3% and the SP500 is down 5% on average, it's a likely explanation that the tumble has nothing to do with HD's outlook. Heck, by some measures, the home improvement retail sector would be doing better than average! The same thing happens when the market is on the way up: Looking at a company or a sector in isolation doesn't let us even speculate on the reasons of the price change. In a site like this, where we care specifically about the health of tech, claiming that the sky is falling for our sector without looking at other sectors would be folly.
tacos 11y ago
You can click two boxes on maybe 300 different financial websites and see this data. Which doesn't apply to the "unicorn" situation anyway. Volatility appears (and is fed back) as people re-evaluate risk vs reward. People who held unfashionable Microsoft stock made more money than people who got in on the last two Tumblr rounds over the same time period. Early investors are no longer just technology zealots who made $300 million 10 years ago -- actual financial companies are involved now. Also early-stage startup investing is a drop in the bucket of the greater market. If people are even bothering to move their money out, that's an even more significant indicator.
tosseraccount 11y ago
XLK: Technology Select Sector SPDR ETF: down 7% last 3 months. GSG: iShares S&P GSCI Commodity-Indexed Trust: down 26% last 3 months. http://finance.yahoo.com/echarts?s=XLK+GSG+Interactive#{%22range%22:%223mo%22,%22allowChartStacking%22:true} http://finance.yahoo.com/echarts?s=XLK+GSG+Interactive#{%22r... add GSG to compare.; set to 3 months.

pc86 11y ago

Why is it important how tech is doing relative to other unrelated markets? Edit: I don't know why I'm being downvoted for asking a question. I've many times seen a stock sector performance chart (I don't know the technical name) with most of the market red and tech lit up bright green.

hibikir 11y ago
Because all markets are really related in some ways, and you can't judge performance without looking at alternatives. Sometimes, a sector goes down, or up, by itself, and then we can expect that the reason for the price change has something to do with that sector. The same thing happens when looking at companies: If Home Depot is down 3% but Lowes is also down 3% and the SP500 is down 5% on average, it's a likely explanation that the tumble has nothing to do with HD's outlook. Heck, by some measures, the home improvement retail sector would be doing better than average! The same thing happens when the market is on the way up: Looking at a company or a sector in isolation doesn't let us even speculate on the reasons of the price change. In a site like this, where we care specifically about the health of tech, claiming that the sky is falling for our sector without looking at other sectors would be folly.

tacos 11y ago

You can click two boxes on maybe 300 different financial websites and see this data. Which doesn't apply to the "unicorn" situation anyway. Volatility appears (and is fed back) as people re-evaluate risk vs reward. People who held unfashionable Microsoft stock made more money than people who got in on the last two Tumblr rounds over the same time period. Early investors are no longer just technology zealots who made $300 million 10 years ago -- actual financial companies are involved now. Also early-stage startup investing is a drop in the bucket of the greater market. If people are even bothering to move their money out, that's an even more significant indicator.

tosseraccount 11y ago

XLK: Technology Select Sector SPDR ETF: down 7% last 3 months. GSG: iShares S&P GSCI Commodity-Indexed Trust: down 26% last 3 months. http://finance.yahoo.com/echarts?s=XLK+GSG+Interactive#{%22range%22:%223mo%22,%22allowChartStacking%22:true} http://finance.yahoo.com/echarts?s=XLK+GSG+Interactive#{%22r... add GSG to compare.; set to 3 months.