How Well Did Hype Stocks Do Last Year?

March 16, 2022

How well did hype stocks do last year? The answer may surprise you as we go over the top three most hyped stocks of 2021.

Full Transcript:

Hello, and welcome to Arista Advice! Question of the week is: "Paul, there's a lot of media attention on a lot of these hype stocks. How well did they do last year?"

As you'll see on this chart, we went and did some research. The research we put together was that we took the boring index fund of the S&P 500, the Fidelity Freedom 2055, the Vanguard Total World Stock Index, Netflix, ARK, and Meta Platform, used to be known as Facebook. We put all of these investments together thanks to the people over at YCharts, and we looked to see how they did from January to this week.

As you'll see on this chart, the stocks that were hyped the most, Cathy Wood's ARK, did really good beginning to first quarter of last year, and it's already down 43%. They are seeing investors flee because what was hyped and what was all talked about, the rage, has turned out to just be a mirage in the desert, but the best investment has been the boring index fund. That index fund is positive 16.78% when ARK is down. Facebook is down. Netflix is down, and the only three positive things are the Vanguard, the Fidelity, and the S&P 500.

This chart is very helpful for us to remember to reduce our media intake, and stay focused in an undisciplined world. Have structure in an unstructured world, and oftentimes boring and simple is your friend when it comes to investing.

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