At the beginning of the pandemic last year in March, the Dow Jones Industrial Average declined, and lost a tremendous amount of value. Airline companies, oil companies, and retail companies were hard hit and still, to this day have not fully recovered. However, “stay at home” technology stocks benefited from the pandemic, and as a result, outperformed the market by a large amount. Now, with states starting to open back up and people starting to get back to a normal life with the vaccines being distributed, will these “stay at home” technology stocks continue to thrive? Stocks like Zoom, Netflix, Amazon, Shopify, and even Peloton had massive gains because of people being locked down in quarantine. FAANG had an outstanding 2020 with all the stocks outperforming the S&P 500 by a minimum of 15%. FAANG “is an acronym that refers to the stocks of five prominent American technology companies: Facebook, Amazon, Apple, Netflix; and Alphabet (Google)” (Investopedia.com). As you can see in the image below, all companies in FAANG outperformed the S&P 500 in 2020 (spglobal.com). These companies greatly benefited from the lockdown, and everyone staying inside. With everything being shut down, it makes sense as to why technology stocks reacted the way did. As stated earlier, the big question is, will these big “pandemic stocks” continue to outperform with people and business’ anxious to get out and states lifting restrictions?
https://www.fool.com/investing/2020/09/06/these-3-tech-stocks-are-huge-winners-of-the-corona/ (content)
https://medium.com/high-finance/an-incredible-2020-for-faang-stocks-but-not-for-stocks-3b9454edffd5 (pic and content)
https://www.spglobal.com/marketintelligence/en/news-insights/latest-news-headlines/faang-stocks-see-massive-growth-in-2019-but-risks-loom-for-big-tech-57290511
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