What's going on?

According to analysts at investment bank Goldman Sachs, despite large tech stocks hitting their highest-ever level on Tuesday, investors shouldn�t worry about a �tech bubble�.

What does this mean?

Stocks of Facebook, Amazon, Apple, Microsoft and Google�s parent, Alphabet (a.k.a. the �FAAMG� stocks), have run up in recent years, with a few of the tech behemoths close to becoming the world�s first trillion-dollar company. Currently, the total value of FAAMG stocks is greater than Germany�s annual economic output. Beeindruckend!

Some investors are worried that tech stocks have increased too much, too soon, and that the �bubble� could burst, sending valuations spiraling downwards like in the early 2000s � when some investors lost up to 80% of their cash.

Why should I care?

For markets: �Keep calm and carry on (investing)� � Goldman Sachs.

In a note to investors, Goldman Sachs said it doesn�t believe there�s a bubble in tech stocks. A key difference compared to the early 2000s is that 90% of the shares� rise is explained by profit growth at these companies (in the dotcom bubble, tech companies weren�t making profits so investors were largely buying in the hope of profit on the horizon). Goldman�s analysts also said that tech companies only represent about a quarter of the US market right now � and as sectors ranging from retail to finance increase spending on technology, there�s plenty of room for tech stocks to continue to grow for the next decade and beyond.

For you personally: Apple sets the scene for the future of tech.

Shares of Apple rose by 1% on Tuesday following the first day of its developer conference. On Monday, the company set the stage for how your interactions with technology and apps may evolve: privacy was front and center, with Apple�s Safari web browser set to block tracking features like Facebook�s Like by default. And, perhaps in response to investors asking the company to help battle phone addiction, Apple�s introducing ways to track � and set limits on � how much you�re using your devices.