In my previous article, I recommended if an investor want to invest in US Equity, she/he should consider more on Nasdaq rather than Dow Component.
There are few reasons:
A: I still see there are a lot of unclear in the banking sector it is far from resolves.
B: Even if the problem resolved by the end of year, majority of the stock in Dow component has limited growth potential.
C: Furthermore, since government start to nationalize these companies may take years to have their business model set up, which can be very difficult.
D: Before I see any blue sky in the financial sector, I personally do not recommend as a long term investor to jump into any financial stock who use too much leverage over the past decade!
E: In the 1990, The technology sector has gone through first stage of its business cycle, which is really the emerge cycle. And that could be the reason why it has gone through a major bubble, where most people mentally think it is the New Technology
10 Years later, Technology is one of the major industry in the world. It is more like compared to the auto industry in the 1900’s. It could be that Technology entering into a growth stage of its business cycle. For those who does not understand business cycle. I can provided a simple review
All business go through Four Major Stages
Emerge, Growth, Mature, and Decline
