Hello folks, Herb Greenberg at Marketwatch wrote a great article about the technology sector latest booming, and focus on the actual definition and tech stock.
So what is a tech stock actually? Broadly defined, high-tech is anything having to do with telecommunications, semiconductors or personal computers, but that's actually a bit misleading.
The article even suggests a way to check if one is actually a tech company, it must spend some exorbitant amount on research and development" resulting in products that more than pay their own way.(though that's also a bit misleading if you ask me).
Greenberg criticizes the categorization of major investment-banking firms, mutual funds or stock indexes , into a one size fits all type of grouping, for no reason other than perception or guilt by association.
According to Andy Kessler tech analyst , The easiest way to figure that out is to look at gross margins and the amount spent on research and development relative to sales. On both counts, the higher the better.
Greenberg even takes a look at market leader Google. (hint: his verdict may surprise you)
Monday, October 15, 2007
What is a "Tech Stock"?
Posted by
Yarin Hochman
at
2:01 PM
Labels: Herb Greenberg, marketwatch, stocks, tech
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