One Year after the Peak: Tech Dives, Financials Rise
Tech funds lag financials by 100 percentage points over the past year.
At the height of the new-economy stock rush, few people were predicting the reversal of fortune that we've seen over the last 12 months. Sure, a lot of investors thought the Nasdaq Composite would occasionally flush out some of the speculative froth that had lifted it to its apex of 5048.62 on March 10, 2000. The prevailing wisdom, though, was such corrections surely would be short-term dips and buying opportunities on the way to new heights, not the agonizing death march that materialized.
One year ago, who would have guessed that over the next 12 months the Nasdaq would give up all the ground it gained in the heady days of 1999? Or that in the following year financials would outgain tech stocks by more than 100 percentage points?
Dan Culloton has a position in the following securities mentioned above: CFIMX. Find out about Morningstar’s editorial policies.