Will history repeat itself with tech stocks?
Those who cannot remember the past are condemned to repeat it.
Let’s hope that old saying doesn’t apply to the latest gauge of individual-investor sentiment.
A survey released Tuesday by financial-services firm Edward Jones shows that American investors are bullish –- on technology stocks and gold.
Never mind that both have had sparkling runs over the last two years that have stirred increasing concern about overvaluation.
The advances in tech stocks –- driven largely by enthusiasm over social-media companies such as Facebook –- have skeptics wondering whether the sector is nearing bubble territory reminiscent of the late-1990s Internet craze. That frenzy, of course, ended with a brutal bear market.
In the survey, 36% of respondents said they expected tech stocks to be the best-performing investment this year, followed by 31% who favored gold.
It’s possible that some of today’s tech bulls are too young to remember the tech-stock crash of 2000-2002: Optimism about the group was strongest in young people, with 47% of those aged 18 to 34 saying they were upbeat on tech issues.
Kate Warne, an investment strategist at Edward Jones, expressed concern about investors’ ardor for gold.
"Our research of gold's performance since 1970 indicates that gold tends to fall as quickly as it rises, and over longer-term periods it fails to match the performance of stocks as represented by the S&P 500," Warne said.
-- Walter Hamilton