March Madness (And Why It Matters To You)

After a two-year, COVID-19 induced hiatus… 

This week I was reminded of the excitement of the return this weekend of March Madness (NCAA men’s basketball tournament).

My colleague’s description of the March Madness betting expectations sounded like the same stories I hear about the market’s upside projections, like Tesla’s continuous volatile climb this past year or the re-opening of society.

I shouldn’t have been surprised.

This is MARCH MADNESS, and this weekend, 64 college men’s basketball teams will get the opportunity and privilege to compete to be called the best in all the land. I’m told there are a lot of “new teams” that have not competed in the NCAA basketball tournament in many years, if not decades.

These new teams are like a small-cap stock that has exploded in price and now rests in the NASDAQ 100 (QQQ).

These new teams are from schools as small as 4,000 students that have been pining to make the playoffs for many decades.

They haven’t won a single game in the tournament for some 50 odd years.

I mention the tournament because, like the markets hitting new highs, the appetite for college sports reminds me of the ongoing excitement and enthusiasm surrounding the new IPOs, SPACS, and obscure technology companies which are all generating fresh interest daily.

Making this year’s March Madness even more maddening is the fact that on Friday there were 6 major upsets! Then on Saturday night, there were another two making it a total of 8 huge upsets.

One example, the #15 seeded, 4,000-student Oral Roberts, defeated the 60,000-student, #2 Big Ten Ohio State.

March Madness upsets like these demonstrate the power of the right team, in the right place, at the right time.

March Madness upsets are like the potential of small-cap stocks.

Imagine if you had the right technology stocks last year, like Zoom (ZM) and Moderna (MRNA), in your “bracket” or portfolio last year as they rocketed from obscurity to leaders within their categories.

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