The Dot-com crash followed the collapse of speculative technology-company valuations between 2000 and 2002.
During the late 1990s, investors poured money into internet businesses, many of which had little revenue or no profits. The Nasdaq Composite rose dramatically, reaching a peak on March 10, 2000. When expectations changed, technology shares fell rapidly and many internet companies failed or were acquired.
The Nasdaq ultimately lost about 78 percent of its value from its peak to its October 2002 low. The downturn also affected telecommunications companies and other businesses whose valuations had been tied to the technology boom. Unlike a single-day crash, this was a prolonged unwinding of an investment bubble.
The Dot-com crash is often confused with the 2008 financial crisis. The earlier event centered on technology and internet valuations, while the later crisis was rooted largely in housing finance, mortgage securities, and banking-system stress.