5 upvotes, 1 direct replies (showing 1)
View submission: Don't invest recklessly
If one considers the valuations of tech stocks such as Amazon or Tesla or Netflicks over present earning they are similarly speculative to Bitcoin. If not for easy money from the Fed stock prices would not be so inflated now.
Comment by awoeoc at 30/11/2017 at 23:18 UTC
3 upvotes, 1 direct replies
The average PE ratio on the S&P 500 is in the mid 20's somewhere, which is higher than the historical norms, but not crazy like some of these tech stocks like the ones you've mentioned. Overall the US stock market is a bit "expensive" right now but not multiple times more than it should be to be considered normal.
But yeah buying stocks with really high PE ratios makes a ton of assumptions that things will go well for the companies. The term "priced to perfection" comes to mind.