Nasdaq Bear Market (-20%)
Tech enters bear territory
Nasdaq bear markets: 2000-02 (-78%), 2008 (-56%), 2018 (-24%), 2020 (-33%), 2022 (-37%). Recovery times vary enormously — the dot-com bust took 15 years; 2020 took 4 months.
| Date | 1M return | 1Y return | 5Y return |
|---|---|---|---|
| 1973-04-25 | -1.1% | -16.6% | -12.7% |
| 1978-10-31 | +1.7% | +10.2% | +78.7% |
| 1981-09-25 | +4.8% | +9.4% | +105.9% |
| 1984-02-06 | -2.2% | +14.1% | +88.2% |
| 1987-10-19 | +8.1% | +22.9% | +81.2% |
| 1990-08-21 | -3.2% | +17.9% | +73.5% |
| 1998-08-31 | +6.2% | +37.9% | +6.7% |
| 2000-09-06 | -3.8% | -25.9% | -17.5% |
| 2008-02-06 | -2.5% | -36.2% | +13.8% |
| 2018-12-21 | +9.3% | +33.4% | +97.6% |
| 2022-03-07 | +7.7% | -5.0% | — |
| 2025-04-04 | +10.5% |
What history says
Editorial commentary written by ALAN analysts. Figures cited below are analyst-authored context — they are not derived from the chart above and may reflect different windows or sources.
2000 was a profitless speculation bubble (80% of IPOs had no earnings). Today's tech leaders generate massive free cash flow. Comparing every tech decline to dot-com is analytically lazy.
Tech bear markets driven by multiple compression (2022: rising rates) recover much faster than those driven by earnings collapse (2000-02: dot-com revenue evaporation).
Tech has delivered ~14% annualized since 2010 vs. ~11% for the S&P 500. The premium compensates for higher volatility. Eliminating tech exposure after a bear market locks in the pain without capturing the recovery.
Before extrapolating a tech bear market, identify which kind it is: declines driven by rising rates compressing valuations have recovered far faster than those driven by evaporating earnings. Review whether your holdings' cash flows are intact — and if they are, rebalancing back to target has historically served investors better than eliminating the exposure after the damage.