Stocks have been driving all of that action within technology. Justiertodate, look at the lens of exchangetraded funds, the spdr, the s p, up 16 , very respectable and take a look at the tech sector spdr, xlk, 32 so a doug over its competitors within the market. Take a look also going all the way back to 2009 this was the last time that we saw this kind of outperformance by technology overall. That gap is just widening out as we see that performance. We took a look within the xlk, the spdr technology action, so we looked at stocks over 100 billion in market capitalization and have posted better than the index returns. Check this out nvidia no surprise there doubling so far this year. 129 billion company facebook, we talked about it earlier on the show. Up, a 526 billion and broadcom, 112 billion market cap. Everybody talks about apple all the time, nearly 900 billion of market cap 50 upside there and match the card 47 , its 160 billion company so a lot of names out there driving on the performance and these ones are the ones with the biggest influence at least within the sector and this etf overall. Back to you. Thanks very much, dom chu lets trade technology and, josh, ill start off with you because this gets at the question that all individual investors face right now and thats do you stick with what is working into year end . If you know that the Top Eight Companies by market cap have had 1. 5 trillion in market cap year to date, is that what we still buy . Obviously the inner contrarian inside of everyone that never wants to look foolish and wants to be ahead of the next thing would look at that and everything dom just brought up and say, yes, its too much or its too far too fast or its too big. The problem is you get beyond the xlk and start looking at the individual companies, and they are crushing it to such a degree that its like, yes, as much as i want to be the guy that says, nope, this is it, this is the top. Its too much. Its so hard to make the case that any of these companies are at execution risk or not going to kill it in 2018 now, of course, things can end up happening that change what im saying now, but just right this moment looking at this when you look at individual stories you can understand why this has gone on this year, and even secondtier names like adobe and things we barely ever talk about, just the incredible rufns not just share price appreciation but great, great news. So the economy has transitioned from a bulk economy to a software and services economy, and thats obviously where Technology Fits in it also has the International Exposure so its participating in the global synchronized growth high Revenue Growth is up 16 year to date and if were going in 2018 to lose technology from the equation of a market real, if we were to lose, it then, yes, because of the significant weighting. Thats going to impact the market, but signs are not there right now to suggest that thats going to occur to joshs point, particularly when you look at earnings, and additionally the repateiation component of this which we still dont have visibility on, theres about 400 billion in the Technology Secretary thoor would be coming back how do they make usage of that however they do, i think that would rally the sector further a couple things the way i look at it, do you keep with whats working and to me im looking at the fundamentals rather than momentum in the stock, which is good, and the fundamentals keep working. But they can coexist, right . Absolutely. Yeah in, some markets, where markets get frothy, thats where youve got to watch out because then they all move up. Thats not the case or situation. The other thing is where else are you going to invest in tech . Europe is very, very low in their tech exposure. Thats why they are relatively underperforming compared to other parts of the world. Exactly the tech stocks they do have are overvalued relative to the u. S. Because in are so few of them. So if you want to be a tech investor and exposure there, youre coming to the u. S. Like youre coming to our tenyear and Government Bond and thats why its keep going. I think the facts, steve makes a great point, and i think the fact that this is an International Phenomenon because hes right the relatively few European Tech names are expensive. No, no, no, no, no, but i think its important to point out, not just u. S. Investors losing their mind and buying into a tech bubble look at china ten cent in the s p would be with the fifth Largest Company in america. Bigger than facebook. Its bigger than the beatles. Whoa. And its a chat app at heart. Its we chat im not saying its not good, its great and baidu is very big and alibaba is 480 bill crop not based in the u. S. And most are not doing any business in the u. S. Or europe and they are experiencing a similar moment amongst the investor class so we should not just look at this and say oh, there go americans again getting gaga over tech stocks. The fact of the matter is that stab, sort of the chinese equivalent of f. A. N. G. , they are crushing it as well. Yes thats technology as well as services. Right. In fact, they are outperforming for the last month h. Services are outperforming tech because you take a look youve got amazon up 18 , services but obviously tech because of aws and everything that it takes to deliver same thing with alibaba. Same thing, by the way now with walmart. With the jet acquisition that we talk about here all the time so obviously technology is the focus stock for many of us because of the outperformance the xlk has had as dom says but also how that Technology Real moves businesses. Right. I mean its great that facebook does what they do and google and thats mainly an ad play in my mind, mel, but when youve got aws over at amazon and delivery of goods, i think that we were debating we were debating walmart on this desk. They bought jet and the acquisition closed last september. They paid 3 billion and people were losing their minds. Walmart has added 70 billion since closing the jet acquisition, and if youre going to make the case that its for any reason other than having the jet people come in and get their ecommerce story together, youd be completely wrong, and its totally about that investors want to be seen to have portfolios that reflect what the future is going to be. Kevin, ill bring you in, particularly on the point of europe being underweight technology youre one to have known to have loved europe, love europe currently as an investment, but when you look at msci europe its a 10 weighting compared to the usa which is a 25 weighting so where do you stand on that . Its a fair point, but i would point out that asia actually outperformed europe and europe outperformed us regarding this whole tech thing i take a different stab at it. The whole idea you stay with tech regardless of how fast it grows or what you think its going to do in 18, lets add a little discipline to it. I think some rules that matter a lot about concentration and diversification should come into play here. Heres a rule. Dont let any one name be more than 5 of your portfolio. That means youre selling half of the stocks that dominic led the sector with and if you let tech become 20 of your hold, youre crazy if youre in an index funneled its already more than 20 of your holdings. Thats my whole point. You should not be indexed to the s p 500 is what youre saying. I am not. I am not indexed to the s p. I am im disciplined. Do not let that tech sector become anymore than 20 . I disagree. Im a seller of apple and enviedia ive taken some off the table because, no, its not different at this time at some point the sector will correct and youll feel the pain if you overweight it. Thats an argument you could have been making in some time it will correct for the entire market, not just for tech but for deere or for caterpillar or for anything, but going back to your original, your opening comment, i firmly believe as do most investors that you need elements of concentration to generate return. Otherwise just buy an etf, and as long has youre watching the fundamentals its not indiscriminate these stocks are not overvalueled i bought lululemon, paid 33 times and guess what facebook is selling at, 33 times so lululemon, which is not a tech company, can you argue thats overvalued i dont think it is, but these have reasonable valuations when youre looking at the growth they put out both in the top line and in the bottom line. They should get a premium to the market and they should an aggressive premium to the market youve got to watch the fundamentals now, tech hedge funds or tech longonly funds, they are all tech i dont think thats irresponsible. You know what youre getting, but as mel pointed out correctly, 25 of the s p is in tech, so if youre buying the s p and youre just buying the etfs on your definition youve overweighted tech. I dont buy it. No. Im going to take exception to that, josh the fact is you this was steve. These are a thing of the past the etf industry is getting a bad rap right now. So many indices being built by many players that give you all kinds of could have vans and a max of 5 weighting in a name and 5 in a sector the new generation etfs that protect you against the concentration youre talking about. Im not im not criticizing etfs im talking the s p. Im pointing out the sector, the sector is overweighted now from a concentration diversification theory i believe in diversification i dont want to own every name regardless of how great the Business Model is. I want diversification. All right. Im just pointing out im selling into the strength and thank goodness im doing it because you guys are like lemings. These guys are like lemmings. Them are fighting words, kevin i want to go to a ledge here and see what this leming is buying, dr. J. What was i buying today i was buying more baba today, even at the highs. Im buying a number of tech stocks, mel. Got some that ill do for unusual activity so there were a lot of things im buying, a very slight dip. Do you feel like a ledming i dont, though i do follow fast money so wherever this is big buying action, im like a surfer i feel the waves starting to pick up and i paddle fast and try to ride that wave until it ends, so i dont necessarily go where everybody is jumping off the cliff. I want to go where the big kahunas are jumping. Settle down, point break. If you define a leming as somebody who is generating superior returns relative to the market who is picking the right stocks based on fundamental analysis, ill be a leming all day long. Josh brown, youre buying twitter. Yeah. Kev, that wasnt me, by the way. That was steve, so the one thing i would point out, these are stocks that have been working all year, and the reason why Momentum Works is because price improvement attracts other people who then come in later, and youre right that will not go on forever and it will end at a certain point, but a lot of people are making the antitech case in january of this year, in jer of the year before and in january, so, yeah, we could say that every year that these stocks are up too much and then one day they will be i dont know how helpful that is. As for twitter . I bought twitter yesterday. I added to my twitter yesterday. The stock has been breaking out. Its getting back above the acquisition rumor highs, and its not doing that because of new acquisition rumors the technicals here look really good you had a stock that double bottomed in the midteens. The last time it did so on very, very low momentum meaning the sellers were pretty much cleaned up, and now you get into 2018 s. Have you low chomps. Twitter has just surpassed snap chats market caps its 16 billion versus 14 billion and the narrative around this company has the ability to shift. If they can repeat what they did last quarter with another net ad in users its not going to be favorably compared to facebook lets not waste our time with that conversation. Its Something Else and when you look at price action the market has decided that this one is going to stick around. Weve got breaking news from the west coast amazon may be diving deeper into the healthcare space cnbcs. Com Christina Farr just broke the story and is live in san francisco. Thanks so much for joining us. In terms of the story, amazon and cerner, what will the relation be . Reporter great question, melissa. Amazon web services which is the Cloud Business is partnering up with cerner 22 billion health i. T. Company and a partnership that will initially focus on whats called population health. In the long run this is a huge deal for amazon aws which has customers big names weve heard of like netflix and kelloggs and aws really needs to break into health care in a big way to drive new growth, and cerner is like a stamp of approval, my sources are telling me its a big name in healthcare. It helps them break new ground. In terms of the bigger vision going into Drug Distribution, for instance, how does that play into the broad strategy, if at all . Reporter i would say its a little bit different because aws is sort of a separate team for amazon, and it could just mean that aws wants to get new healthcare customers which totally makes sense and cerner, ideal partnership for them but having more expertise and partnerships like this, who knows. It could lead to more Drug Distribution and even pharmacy world and thats the big news everybody is talking about that would be the big thing in healthcare for amazon to do. Thanks so much for joining us Christina Farr with that cnbc. Com story what do we make amazon getting into everything . You know, obviously, the Healthcare Industry is an industry that lacks the transparency in terms of prices of other industries, and thats exactly what amazon is so proficient in doing is coming out and providing that Price Transparency so im not surprised by this at all i think the signs have been there. They have actually gone for registration in particular states to be able to sell some pharmacy products, so i think this is something that in 2018 it will build and become a better story. This is more a shot at oracle than it is about the drug distributors though, because they are the i. T. Hub in practices and in hospitals where they deal with the technology. They are bringing it all together and give better treatment guidance for patients, more so than Drug Distribution a stock that i think looks pretty good here is meta data solutions. The ceo just should because they are had the ones that are in the cloud managing all the research for the Big Pharma Companies they have virtually every Pharma Company so youll see a lot more in the space and youve got to be in it in places like ibm involved a little bit and oracle, theydont want to miss this. Youve got a great setup here, too, because it gapped lower after the earnings they missed on top line, bottom line guided lower. The stock gapped from roughly 71 bucks down to 66 down to Something Like that and now it just filled that gap and its making the is 4 Short Interest scream right now they are buying upside calls aggressively thats what this is. Thats why i think thats why i think it had a gap to fill anyway, mel. Its moving up because of real news, like our reporter. This puts a fine point on what we said at the top of this show which is that people are evaluating technology companies, and i know amazon is a Consumer Discretionary technically, because they are looking at things in terms how big could it get, whats the potential scale and whats the tam or total addressable market, amend have you amazon creeping into areas where they werent a year ago. They are creating addressable markets for themselves. Theres a lot to, that and i think people are throwing out old ways of looking out companies that were kept in a box and said, okay, this is just a Software Company okay, this is just a cloud company. The lines are being blurred, and i think investors are thinking about valuation through that prism. Tech isnt the only area in the market where investors are seeing a divergence. Since october the dow transports have fallen lagging behind the industrial average which has risen for 5 so for all you dow theorists out there, should you be worried should you be worried, steve i dont know where Richard Russell is is he still around thats not funny. He passed. I wasnt joking thats the all dow theory. I dont think dow theories applied here for had a long time i own the airlines i. Sell some delta, the reason being they have had a tough times overall managing the narrative they brought capacity when they shouldnt have brought it on if they didnt, you would see the airlines a lot higher. Its not picked up the investor side in Warren Buffett who they needed on the margin to take the group high i still think it works i think ual is very, very cheap here, as is american i just want to cut my exposure. Kevin oleary what do you think of the transports as any kind of indicator . I do . You know, for decades transports have been an indicator about the future of the dow and it bumps off the gdp growth estimates which is getting close to 3 next year. The fact that they are underperforming is not a goodstein if youre a traditionalist like y. Secondly, i look at whats happening between the spreads between it the two and tenyear which has broken down below 90 which is a flagtning curve. The transports and that spread on the two to tenyear are like the canary until coal mine telling you maybe you shouldnt be as optimistic about returns next year as everybody seems to be right now those are leading indicators, hand they should be watched. Sounds like youre going more to cash. No. Im just taking a little powder and keeping it dry thats all im im about 18 going into rebalancing for january. A lot of it came from the sale of these tech stocks that have gone past 5 or 20 sectoral weighting. Ive been a seller still own them, still fully weighted at 5 big owners like facebook taking tens of millions off the table facebook, you can at all it tech but its really an advertising play so youre starting to see a few people saying, maybe, look ill take the gains and park a little cash and wait and see what happen