Just_Super/iStock via Getty Images Conventum - Alluvium Global Fund June 2024 Quarterly Report Introduction The Fund retreated by 2.3%, 3.0% and 5.
3% in EUR, USD and AUD terms 1 . Longer term performance is provided in Table 4. The AI euphoria continues.
Some are comparing the current environment with the dot-com bubble of the late 1990’s. We are reminded of Scott McNealy (the former CEO of Sun Microsystems) reflection after its share price was up ten fold over the two years prior to its August 2000 peak 2 . With the benefit of hindsight, in 2002 Mr McNealy questioned the logic of paying ten times revenue for the business.
Interested readers may refer to that classic quote in our March 2021 report’s Closing Remarks available here. Sun’s share price fell by 95% over the following two years. And another example - Cisco ( CSCO ) was up seven fold over the two years prior to it reaching its all time high of $80 in March 2000.
At that peak, its price was around 25 times forecast revenue. A year later its share price had fallen by 85%. And what did the professional analysts think? “We are just trying to take what they (investors) are willing to pay and translating it into a target price and, therefore, a stock recommendation.
” - Morgan Stanley Dean Witter analyst, circa 2000 3 Whilst we are certainly not making any predictions, we think it is wise to note some similarities with current conditions. For example, Nvidia ( NVDA ) is up eight fold over the last two years, and .