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For those here who don't know, QQQ is a fund tracking the Nasdaq 100, an index consisting of 100 non-financial companies with the largest market cap on the Nasd

by cs702 2y ago

For those here who don't know, QQQ is a fund tracking the Nasdaq 100, an index consisting of 100 non-financial companies with the largest market cap on the Nasdaq. As the OP points out, QQQ has beaten virtually all portfolios over the past decade. Alas, as the usual warning goes, past results are not a guarantee of future performance. The OP's arguments remind me of the arguments made in the late 1960's by proponents of buying only so-called "nifty fifty stocks"[a] and holding them forever, regardless of their valuation. It didn't work out so well. -- [a] https://en.wikipedia.org/wiki/Nifty_Fifty https://en.wikipedia.org/wiki/Nifty_Fifty

Ekaros 2y ago
So tracking the big tech companies... It will work until it does not. And I believe we are closing on the days when it will not work anymore. Or at least corrects in substantial way. Not that I would ever bet against market, but with any strategy picking right entry point can make good looking numbers.
- wslh 2y ago
  I think the issue is about risk management and, potentially, that is why top funds are below QQQ. But, following your main point, I agree that this cycle of tech could be very different of past cycles. We are at a point where the tech market has already reached the whole human civilization and the room for growth is not so obvious. I also have the hypothesis that there are no more ads to show! For example, Google has bombarded us with zillions of ads and there is a point where it is intolerable. The TV suffered a similar effect in the past. Finally, there is no more free lunch on sharing personal data and compliance measures will increase. In the past, the tech sector was almost completely immune of regulations.
  - Ekaros 2y ago
    Also, money for ads must come from somewhere. At least after VC and like run out of theirs... That means economy selling goods and services must generate money to be able to spend it on adds in first place. And to my understanding this sector buying the ads has not been skyrocketing like those serving the ads.

by cs702 2y ago

Ekaros 2y ago

So tracking the big tech companies... It will work until it does not. And I believe we are closing on the days when it will not work anymore. Or at least corrects in substantial way. Not that I would ever bet against market, but with any strategy picking right entry point can make good looking numbers.

wslh 2y ago
I think the issue is about risk management and, potentially, that is why top funds are below QQQ. But, following your main point, I agree that this cycle of tech could be very different of past cycles. We are at a point where the tech market has already reached the whole human civilization and the room for growth is not so obvious. I also have the hypothesis that there are no more ads to show! For example, Google has bombarded us with zillions of ads and there is a point where it is intolerable. The TV suffered a similar effect in the past. Finally, there is no more free lunch on sharing personal data and compliance measures will increase. In the past, the tech sector was almost completely immune of regulations.
- Ekaros 2y ago
  Also, money for ads must come from somewhere. At least after VC and like run out of theirs... That means economy selling goods and services must generate money to be able to spend it on adds in first place. And to my understanding this sector buying the ads has not been skyrocketing like those serving the ads.