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Old 07-17-2018, 11:36 AM
 
Location: East Coast of the United States
27,567 posts, read 28,673,621 times
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The NASDAQ has outperformed the S&P 500 over the last 5 years, 10 years, 20 years, 30 years.

So, I'm wondering what would be your reasons for investing in the S&P 500 over the NASDAQ. Do you think tech's heyday is over?
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Old 07-17-2018, 11:56 AM
 
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qqq is way to dependent on just a few stocks . it really should not be a case of either or . they should go along with each other
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Old 07-17-2018, 11:57 AM
 
Location: Sputnik Planitia
7,829 posts, read 11,790,682 times
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I put your selections in the Backtest Portfolio Analyzer and got the following results. $10,000 invested 100% in each security with a monthly contribution of $1000. Start Date: Jan 2000, End Date: Current (July 2018)

Ending balances as of current:

DIA (DJIA) - $606,476
SPY (S&P 500) - $578,232
QQQ (Nasdaq 100) - $846,456

So, yes, you are right the Nasdaq 100 has left others in the dust, but will this be the case for the future? We have had a huge runup in tech in the last few years so i'm guessing that is affecting the returns of QQQ. Not sure that can be extrapolated to the future.
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Old 07-17-2018, 02:07 PM
 
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I tend to agree with you. S&P is more diversified, but BOTH are actually largely driven by TECH and even specifically FAANG.

The Nasdaq has outperformed the S&P since the February "crash". Nasdaq is at new highs, S&P is only back about 70% (much recent gain since some stocks were added, TWTR & NVIDIA). But the Nasdaq also sells off more drastically when it goes down.

The Dow is the index that has made up the LEAST since the Feb "crash." So - there are two ways to look at it. Personally, I tend to think the DOW has the most room left to recover (grow), but I also like Tech for its growth factor (Nasdaq). I find the S&P to be the most boring, which is good if you don't want to watch the market every day.
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Old 07-17-2018, 02:12 PM
 
Location: East Coast of the United States
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Record high close on QQQ and the NASDAQ today.
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Old 07-17-2018, 02:21 PM
 
Location: Sputnik Planitia
7,829 posts, read 11,790,682 times
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we should remember that the Nasdaq 100 fell a shocking 82% during the last tech crash in 2002.. I don't think most people have the nerves to handle that kind of volatility even if it's temporary... lol.
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Old 07-17-2018, 05:31 PM
 
Location: East Coast of the United States
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Risk of loss is the price of investing.
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Old 07-17-2018, 06:25 PM
 
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Quote:
Originally Posted by BigCityDreamer View Post
Risk of loss is the price of investing.
Then why pick QQQ and not a single name?
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Old 07-17-2018, 06:55 PM
 
Location: East Coast of the United States
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Quote:
Originally Posted by Lowexpectations View Post
Then why pick QQQ and not a single name?
In my experience, it is virtually impossible to pick which individual stocks out of thousands will perform well compared to the market over a period of 20-30 years.

Maybe if you have a major stroke of luck.
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Old 07-17-2018, 06:57 PM
 
26,191 posts, read 21,591,383 times
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Quote:
Originally Posted by BigCityDreamer View Post
In my experience, it is virtually impossible to pick which individual stocks out of thousands will perform well compared to the market over a period of 20-30 years.

Maybe if you have a major stroke of luck.

But I thought you said the risk of loss is the price of investing no?
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