Despite the markets not reaching recent highs, experts are analyzing whether this AI stock rally constitutes a bubble.

Historical data suggests that the market may not be in a bubble just yet.

When compared to the tech boom of 2000 and the meme stock surge of 2021, the current 3-year S&P 500 return of 30% is significantly lower.

Additionally, the number of companies contributing to the market’s rise is smaller than in previous rallies.

Notably, fewer highly valued companies are driving this rally.

Furthermore, investors are not borrowing heavily to buy stocks, which could indicate a lack of the overleveraging typically seen in bubbles.

Historical market trends suggest current rally may not be a bubble.

In comparison to past market surges like the tech boom of 2000 and meme stock rally of 2021, the current S&P 500 return of 30% over three years is considerably lower.

Concentration of gains in fewer companies suggests a lack of widespread exuberance.

Unlike previous market rallies, a smaller number of highly valued companies are driving the current growth, indicating less overall market enthusiasm.

Low levels of borrowing suggest investors are not overleveraging.

In contrast to typical bubble behavior, investors are not borrowing heavily to purchase stocks, which is a sign of cautious investment practices.