This is a very critical week for technology earnings, with AMD, GOOG and MSFT reporting on Tuesday after the close and then AMZN and APPL on Thursday. The top 6 technology stocks comprise 27.6% of the S&P 500 and the top 6 in the Nasdaq 100 comprise 37%. Our point, these stocks are very over-owned! As a rule-of-thumb, over 1x the PEG (P/E versus the growth rate) is considered getting expensive. We believe 1.5x is okay if the company is very predictable.

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