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Excited About the Nasdaq Record? Don’t Overpay for Stocks Again

Wall Street Journal Original article ›

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According to AJO, institutional money manager in Philadelphia, the average return since March 10, 2000, for the S&P 500 is about 5%, and the NASDAQ Composite less than 1% annually, including dividends. Zweig cites this to show that investors not make the mistake of overpaying for tech stocks or startup stocks, or buy into the hype for a second time since 2000. The NASDAQ Composite hit 5048 in April 2015. The last time it was at this level was on March 10, 2000. Cisco traded at 167 times earnings at the time. For the average long term S&P 500 index shows it traded at an average of 16 times earnings. This is a sober reminder for the average investor that gains depend on on what you pay for a stock.

Jason Zweig on the NASDAQ at 5000- the startup boom and lessons for the average investor

11/28/2013

Zweig says the S&P 500 has generated average investor returns of about 5% since 2000, and the NASDAQ less than 1%, making it important that investors not overpay and get caught up in the hype.

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Excited About the Nasdaq Record? Don’t Overpay for Stocks Again

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