As an add-on to the post below that describes the correlation between the 1999/2000 stock bubble and today's market, I am noticing another similarity: micro cap value vs growth (or pie in the sky I like to call it) is again out of sync. Back in the day it was "Brick and Mortar" vs "Dot.com" or more precisely, something that had profitable earnings vs the pie in the sky hopes of one day having earnings, with brick and mortar stocks dropping every day while the growth hype hitting extreme insanity. Same today... I just looked at a list of value micro caps I follow and today while the Dow/Nasdaq/SPY are all up insane amounts (1% on Naz) almost 80% of the value micro cap stocks are actually down on the day. Again, just a little bit anecdotal but strange to say the least. Perhaps the $0 commissions have mom and pop selling anything boring to free up some cash to get the shiny new TSLA stock at $950! Momentum does beget momentum in both directions (up and down) and where it stops... nobody knows. But must be getting close. Another similarity is energy... oil and nat gas stocks are crushed just as they were in 1999/2000 (but I suppose I am already putting these stocks in the "value" bucket)
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Paul SaadSenior Manager, Paul Saad and Associates, LLC Archives
May 2020
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