Investing Advice: Could Technology Underdeliver?
Posted On May 15, 2018 12:03 pm
By: Steve Smith
By: Steve Smith
There’s only been a few times in history where markets have been so dependent on the steady outperformance of so few companies. Escalating regulatory concern in the E.U. and U.S. presents a clear and present danger to tech’s market leadership, and in turn, the S&P 500.
While the current FANG and already public tech companies might simply see underwhelming performance over the next decade, they probably are not in a bubble or in danger of going out of business.
The same cannot be said for private companies, or new asset classes such as blockchain-based businesses, which are seeing huge sums of venture capital money being pumped into them.
Venture capital has exploded since 2013, increasing from $50 billion to $150 billion. Most of this money comes from Asia, and it’s now surpassed the dot.com bubble levels.
I’m not saying this will all end badly, but there will be plenty of failures, tears and money lost along the way. Our investing advice is this: to be forewarned is to be forearmed.
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