Railroads. Radio. Nifty Fifty. Personal Computers. Biotech. Internet
You see that every few decades there are new bubble/booms. And in every new boom there is a bubble in a few of the leading names.
In the most recent Internet boom the stocks everyone had to own were the “Four Horsemen” of Microsoft, Intel, Cisco & Dell. They peaked with a market value of nearly $1.5 trillion. Combined they bottomed just a few years later with a value of of $250 billion, a loss of 80% from peak to trough. They have since doubled off their respective low-water mark to a market value of about half a trillion.
Today that group is comprised simply of Apple, Google & Amazon. Currently they sport a market value of just over $1 trillion. At their low water mark, at their 2008 lows, they traded with a market value of about $170 billion. They are up almost 500%.
In each bubble/boom, the names that “everyone must own” become ridiculous, yet are justified at their time. Today is no different.
6 Responses to Same Game, Different Names.
Percentage increase =
[(Ending value - Starting value) / Starting value] x 100
So, for the three companies you speak of:
[(1 trillion - 170 billion) / 170 billion] x 100 = 488%
Dell from 1996 to 2000 where it increased from $0.72 to $60:
[(60 - 0.72) / 0.72] x 100 = 8233%
Whoops. I hit the 5 twice, by accident…corrected
Wait, are you saying I can’t get rich buying the Nifty Fifty?
What will the next batch be?
bonds.it’s a new bag by loui vitton, all the masses will be holding one !