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Discussion Starter · #1 · (Edited)
I work(ed) in high-tech, near Silicon Valley in the US, and saw the industry become extremely over-heated. It ramped up around 2017, people getting insanely high salaries, huge stock compensation, companies getting VC funding and selling out, seemingly everyone (in tech) getting rich beyond their wildest dreams. There was so much money flowing around and making everyone rich. It got even more insane in 2019 and then we know what happened in 2020-2021 when it went ballistic.

People in the media talk about covid and the pandemic stimulus driving tech higher, but it all started long before then. The tech market was already insane by 2019. The whole thing was pumped up for many years by the Fed's zero rates and QE, going back to at least 2014.

I think there was a tech bubble and I think it's bursting now (with credit tightening). I'm curious if any of you trader type of people are shorting tech? I have no position, but I'm watching this chart... PSQ = short QQQ

Rectangle Slope Plot Line Font


Could this be the start of a long uptrend, perhaps? (meaning a prolonged NASDAQ crash)

I think it might play out like that. I think we could be in a phase of the game like 2001, where everyone is in denial and doesn't yet acknowledge that the bubble is crashing. Many signs are there, including the giant leaders finally cracking and crashing ... AMZN, TSLA, AAPL.

In the first phase of the crash, the tiny sketchy companies (all the SPAC / micro cap junk) crashed. The crypto garbage got wiped out. When the giant/mainstream ones start to fall, you're in the next phase of a crash. The same kind of pattern played out during previous crashes such as 2007-2008 banks and lenders.

This is very speculative of course, but I think there's a chance that we could be in the early phase of a prolonged crash and bear market in American tech.
 

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I removed all exposure to cashflow negative tech over a year ago. Shorting is something I considered but chose not to. It’s been in a bear market for these companies for some time and while it can always going lower I think the easy money has already been made.
 

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I initiated a small position in big tech AMZN and MSFT recently in case the bottom was in for large tech. If we see further declines or sideways movement in the first half of 23 I may add or buy Apple. Not sure if there are many here that implement a shorting strategy. Perhaps there are some but I am not aware of any that do so or share that they do. At best you may get some input on where people think tech is headed. I am of the mindset that tech in general will be in a period of consolidation for the next while. Innovation will continue at a rapid pace but equities may not see the same valuation until the next bull market is well underway.
 

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Discussion Starter · #4 ·
I removed all exposure to cashflow negative tech over a year ago. Shorting is something I considered but chose not to. It’s been in a bear market for these companies for some time and while it can always going lower I think the easy money has already been made.
Interesting, thanks. I also have been careful to control my exposure to these kinds of things but I just haven't gone as far as short selling.

Going short is a dangerous game, as equities tend to go up over time.
 

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I initiated a small position in big tech AMZN and MSFT recently in case the bottom was in for large tech. If we see further declines or sideways movement in the first half of 23 I may add or buy Apple. Not sure if there are many here that implement a shorting strategy. Perhaps there are some but I am not aware of any that do so or share that they do. At best you may get some input on where people think tech is headed. I am of the mindset that tech in general will be in a period of consolidation for the next while. Innovation will continue at a rapid pace but equities may not see the same valuation until the next bull market is well underway.
I sell short occasionally (not here as expressed separately). More typically if I was looking to capitalize on a negative view I would use derivatives since I can better shape my risk/return profile.

WRT tech I am long enterprise software and have been for quite a long time. I like the free cashflow, recurring revenue and moat. MSFT falls within this, and I acquired it when I understood their new strategy (new CEO) back in 2015.
 

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Discussion Starter · #7 ·
I am actually considering putting next tax-free account investment into TQQQ if next earnings don't show massive deterioration
TQQQ performance since inception is 33% annualized. If $10,000 was invested when this fund was created 12 years ago, the investment would now be worth $306,000.

However I think the extreme popularity of leveraged QQQ investments like TQQQ is a symptom of this tech bubble. You're definitely playing with fire if you hold this long term.
 

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I initiated a small position in big tech AMZN and MSFT recently in case the bottom was in for large tech. If we see further declines or sideways movement in the first half of 23 I may add or buy Apple. Not sure if there are many here that implement a shorting strategy. Perhaps there are some but I am not aware of any that do so or share that they do. At best you may get some input on where people think tech is headed. I am of the mindset that tech in general will be in a period of consolidation for the next while. Innovation will continue at a rapid pace but equities may not see the same valuation until the next bull market is well underway.
I have owned Amazon for a while, and just got my position in MSFT, I also have Google and Apple.

The question going forward with Apple is if they can transition to a services company.
I think the hardware industry is going to slow down, there is less and less reason to keep upgrading hardware, and it keeps getting cheaper.

For cloud AWS is the big one, and Azure is working hard to attract customers. I give the edge to MSFT because Amazon has a habit of competing against their customers.
 

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I think they will be able to make the transition based on the company's previous transition success. I am fine with my current allocation to tech and as such am still waiting on APPL. Not sure if it will take the same timeframe to tech to recover as it did after the dotcom bubble. I am expecting it to be sooner rather than later.
 
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