Nasdaq 10 years on: how the tech sector went from boom to bust
Photo: REUTERS
A decade ago the technology bubble was about to burst, having reached a peak
on March 10. The golden goose that had been so hyped up by everyone from
independent financial advisers to first-time investors crashed and burned.
At the height of the technology boom in the UK there were 35 investment funds
in the sector; now there are just 10, with the smallest holding only £3m
under management. An outlay of £1,000 in the worst performing fund (Which)
just before the crash a decade ago would now be worth a paltry £244.
At the start of the millennium investors could not get enough of technology.
The huge returns that the sector had seen in the previous five years created
a buzz that investors found irresistible. If you had invested £1,000 in the
sector five years before the crash and cashed in your investment in March
2000 you would have seen your investment grow tenfold – and in the 10 years
previously if you had picked your stocks right you could have turned £1,000
into £100,000.
By far the most popular fund at the time was Aberdeen Technology, the fund
with the best track record. Ben Rogoff, now manager of Polar Capital’s
Technology trust, was on Aberdeen team during the technology rush. “Investors
and managers alike were clamouring for technology funds,” he said. “The
attitude was that old investment truism- the only thing worse than losing
money is watching someone else make it.”
In the first three …
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