The long-term outperformance of tech by the numbers … the Nasdaq rights itself after its stumble … a potential 10X tech-winner on Luke Lango’s radar today
Let’s begin with a few trivia questions…
From the start of 2003 through the end of last year, what’s your guess as to the returns of the tech-heavy Nasdaq 100 versus the “old school” Dow Jones?
Obviously, we’re not looking for precision here – a general return-comparison will do.
It turns out, the Nasdaq 100 gained 1,210% compared to just 266% for the Dow.
That’s a 4.5X domination.
In how many of the past 18 years did the Nasdaq outperform the Dow?
Got your guess?
14 out of 18.
The four exceptions were 2006 (amid soaring oil prices), 2008 (amid the Financial Meltdown), 2011 (amid sovereign debt crises), and 2016 (when Trump got elected).
If we narrow it down to the past decade, how many years did the Nasdaq beat the Dow?
All of these statistics come from our hypergrowth investment expert, Luke Lango. Here he is for the takeaway:
Technology dominating the world – and tech stocks dominating the market – is a secular trend.
It’s been happening, consistently and regularly, for two decades, and the dominance of tech is only growing, and growing, and growing.
“But wait,” some of you might be thinking.
“Didn’t we just experience a market rotation in which money fled technology and poured into value stocks? Haven’t rising interest rates ended the tech trade?”
Well, that’s certainly what many talking heads on TV were proclaiming. But that doesn’t mean it’s actually true.
Back to Luke:
When the Dow started to outperform the Nasdaq in February of 2021… we knew this was short-lived, as was every prior stretch of Dow outperformance in the past 20 years.
Indeed, it has proven to be short-lived.
From February to mid-March, the Dow rose about 10%, while the Nasdaq slipped 1%. But since mid-March, the Nasdaq has powered 7% higher, while the Dow is up just 3%.
Tech has retaken the lead.
Shocker (not really).
In light of this tech-lead-resumption, in today’s Digest, let’s shake off any misconceptions about tech’s wealth-generating ability. Then let’s look at one of Luke’s latest tech picks that he believes will be a 10X winner in the coming years.
Let’s jump in.
***Tech resumes the lead
For newer Digest readers, Luke is our hypergrowth expert, and the analyst behind The Daily 10X Stock Report. His specialty is finding market-leading tech innovators that are pioneering explosive trends, capable of generating 10X returns for investors over the long-term.
It’s a lucrative approach to the markets. To illustrate, in just the past five years, Luke has recommended 17 different 1,000%+ gaining stocks. Most investors never enjoy even one such 10X-winner.
In Luke’s Daily 10X update from last Saturday, he reminded readers of tech’s long-term market-domination – despite brief periods when “old school” stocks have enjoyed a moment in the sun.
Today, after such a period, tech is roaring back to its rightful, “normal” place.
Things are getting back to normal.
I don’t mean that in the sense that the economy is reopening and people are going back outside again. I mean that in the sense that market dynamics are getting back to normal.
You see… throughout February and March, investors got all hyped up on this “reflation” trade, seeing a once-in-a-lifetime opportunity to buy beaten-up retail, bank, and energy stocks on the idea that they’re going to see a growth surge here in 2021 amid economic normalization.
But that “growth surge” got priced in quickly, and now, investors are asking the all-important question: Now what?
Because we all know what’s going to happen after this growth surge.
Things are going to go back to how they were back in the 2010s. And what was happening throughout the 2010s? Technology was taking over the world, and tech stocks were dominating non-tech stocks every single year.
We are now getting back into that “normal” market environment.
To illustrate, below we look at the Nasdaq versus the Dow over the last month (since March 26).
As you can see, the Nasdaq has more than doubled the performance of the Dow, up over 8% while the Dow has climbed less than 4%.
Back to Luke:
Tech stocks have retaken the lead, and they’ll only strengthen their leadership position over the next decade as advancements in AI, self-driving, gene editing, digital advertising, cloud computing, and more lead to tech influencing and controlling all parts of the global economy.
***An example of one such market leader that’s poised for massive growth
Not even two full weeks ago, Luke wrote why he’s bullish on the 3D printed electronics space.
He noted how there’s tremendous hype on Wall Street with respect to 3D printers being applied to parts prototyping. But not many folks are talking about how 3D printing could revolutionize the electronics industry.
This lack of hype and awareness is an opportunity – after all, one of the keys to unlocking generational wealth in the stock market is identifying investment megatrends before they emerge.
Here’s what Luke has identified when it comes to 3D printing and electronics:
Make no mistake, 3D printing has enormous potential to fundamentally reshape how the world makes electronics over the next few years, starting with how we make printed circuit boards (PCBs).
PCBs are those little green “boards” with patterns, boxes, and wires that you find in basically any electronics device in the world. Those little boards contain multi-layer electronic circuits which give power to electronic devices.
PCBs are, for all intents and purposes, the building blocks of the electronics world. If we want our electronic devices to work, we need PCBs to power them – and the more complex our electronic devices get, the more complex we need to make their PCBs.
That’s a problem, only because the conventional PCB manufacturing process is already very complex, very expensive, very slow, and very antiquated…
3D printing offers a solution for this awful process…
In short, Luke explains how 3D printing – theoretically – could be used to rapidly and cost-effectively “print” PCBs in just hours.
It has been a dream solution, but the problem is that the 3D printing of PCBs was a highly-complex engineering challenge that no one could figure out.
***The unrivaled leader of the 3D printed electronics industry
So, which company is worthy of that accolade?
Nano Dimension (NNDM).
Back to Luke:
Nano Dimension is a $1.8 billion additive manufacturing electronics (AME) company that is leading the way when it comes to making 3D printers to print electronic devices, specifically PCBs.
The company’s leadership position is thanks to its flagship proprietary DragonFly LDM 3D printing system, which represents the world’s first and only precision system that produces professional multilayer PCBs.
In Luke’s Daily 10X issue, he walks through the challenges the industry has faced, coupled with NNDM’s solution.
Here’s Luke with the quick takeaway:
The company’s DragonFly LDM system uses proprietary liquid nano-conductive and dielectric inks to simultaneously print both conductive and dielectric layers at the same time, thereby allowing for a full print of a multilayer PCB at high resolution.
Based on our research, this is the first technology in the world that is capable of effectively printing industry-grade, multi-layer PCBs.
That’s a big deal.
Luke is clear that there are huge risks with such an investment. But he believes Nano’s enormous potential upside more than offsets that risk.
The stock is off to a strong start. Since Luke’s issue less than 10 days ago, NNDM climbed roughly 20% before pulling back, now up nearly 10%. As we’ve noted before in the Digest, this type of volatility is the price of admission when it comes to investing in small, tech disruptors.
If you’d like to read Luke’s entire research piece on NNDM and access his portfolio of potential 10X winners, click here.
Wrapping up, let’s return our focus to the broad tech sector. I’ll give Luke the final word to summarize recent market conditions, as well as what to expect looking forward:
The unusual trading activity that has defined the market over the past few months will not last. It’s already winding down.
A return to normal is right around the corner.
In that “normal” world, our (tech) stocks will once again turn into market leaders.
Have a good evening,