My situation is different, perhaps, so I will consider going long QQQ.
We have here on the value thread, very few investors who are actually buying and holding value stocks, imo. It seems to me that when anyone posts of a value stock, there's generally, not always - but mostly, indifference. With good reason. If I just look at the value stocks I am buying, I find it hard to see why general investors would want to have positions in them. Mundane, dull businesses (compared to QQQ). And if some or all of these value stocks provide a margin of safety for investors-- big deal. I can't imagine anyone in their twenties or thirties even wanting to work in these businesses, let alone invest in them. (Regardless of salaries paid. Come in at high pay, get 4% raises and dinky stock matches that go nowhere. Phooey.) Value stocks - companies that manufacture, companies that rely on physical assets, they are the to-be history for Mexico, Thailand, China. The future of the US is in the QQQ companies. Intellectual based. Desirable places for the best and brightest to work, to compete, to add value.
Stories of internet billionaires created in 3 years and people in their 20's with multimillions in stock. For people who want to participate in the heart of their '90's world, they need to dance the current dance, not the minuet, the waltz, or the twist. Anybody will seek out what's meaningful to them. If not through their own work, then through their investments. People will take money from traditional funds, from traditional investments, and shift them to stocks promising, and for right now, delivering, winning/winner's performance. The QQQ will continue to increase, imo, at the expense of stocks that value investors think are good investments.
I see reports now of funds up 100% this year. The bogey we've talked about on this thread -- beat that S&P 500 -- that's almost passe. If your mutual funds can't even beat that index - when the NASDQ is up what, over 50%, just sell those funds (and so make the managers get out of garp stocks, reit stocks, bricks and mortar stocks, dividend stocks, etc.) Seems pretty rational to me, even if QQQ is at insane heights.
For fund managers, large cap, value, whatever-- I can certainly see that they are doing what they are paid to do - find the best stocks within their working boundary. But I guess too, that every person reading this post personally knows of at least one individual who is making millions by holding stocks of internet companies or QQQ companies. Therefore, to me, it is somewhat reasonable to look at these fund managers and say, you boxed yourselves into a corner, or you were so stubborn in your stock selections, you never bought any or enough QQQ stocks? When there are people, regular folk, all over the country who are making millions of dollars buying and holding QQQ stocks, you guys did too little to late.
Could QQQ stocks be the new S&P stocks for fund managers? They buy and sell within the QQQ universe - trying for an advantage by overweighting or underweighting. But mostly always staying within the QQQ universe. Could there thus be the reality of the NASDAQ (now at 3000+) within a few years overtaking the DOW (at 11000+)?
I don't know what will happen. I suspect that those who are shorting (or buying) QQQ are basing their decisions on what the Japanese call KKD -experience, intuition, and guts. That might work. It might not. |
