In the early 1980s, the investment adage was that technology stocks should be bought in the fall and sold in the spring.
That advice would have served investors well during the past 15 years, when the seasonal rallies on average lasted six months, producing returns of 30%.
But in the past year, the picture has been different, according to a report from Lynch & Mayer, New York.
"We now find ourselves..... in the midst of a 12-month rally that has produced a 67.5% advance in the Standard & Poor's 500 technology sector," according to the report.
Lynch & Mayer officials believe the market may be in a strong secular trend that began five years ago. The firm's technology index, of 226 equal-weighted technology companies, was a flat performer in the 1980s despite strong cyclical surges, but has advanced further than the Standard & Poor's 500 Stock Index for several years.
Further evidence of a long-term secular growth trend: worldwide capital spending on technology to improve worker productivity; product improvements that will prolong the explosive growth in PC use at home and at work; and the nascent overhaul of the world's telecommunications and information delivery networks.