Tech vs non-tech valuations chart

Callum_Thomas
2024-12-27

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Here’s an update to that Tech vs non-tech *valuations* chart you might have previously seen from me — as you might guess from the chart above, tech stocks trade at a significant premium vs non-tech and vs history.

While some of this may well be justified given the extraordinary path of earnings, these things move in cycles.

Valuations in this context are more of a measure of confidence, and a barometer of speculative appetite — a guide point for where we are at in the market cycle.

In this respect I would say we are at the overconfidence phase as folk extrapolate past trends infinitely into the future, spurred on by easy monetary/fiscal policy, and emboldened by a procession of bull markets.

This is the part where price begins to overshoot against even the best of fundamentals... $NASDAQ 100(NDX)$ $Invesco QQQ(QQQ)$ $.SPX(.SPX)$ $SPDR S&P 500 ETF Trust(SPY)$

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Comments

  • KSR
    2024-12-27
    KSR
    👍
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