'It's not healthy to have people who are buying stocks for fun': Billionaire investor Howard Marks says the day-trading boom reminds him of the dot-com bubble

• The billionaire investor Howard Marks took aim at rash day traders in a CNBC interview on Tuesday.
• "It's not healthy to have people who are buying stocks for fun," the Oaktree Capital chief said.
• Marks also flagged similarities between the current speculative frenzy and the dot-com bubble.
• "It reminds me of the people who were day trading in 1999 and declaring day trading a 'can't miss' strategy," he said.
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The billionaire investor Howard Marks said in a CNBC interview on Tuesday that reckless day trading could lead to disaster.

Some people "think it's a gambling game, and they think of it like betting on football," the Oaktree Capital boss said.

"That's not a great thing."

Marks pointed to the "leader of the punters" — the Barstool Sports founder Dave Portnoy —and his claim that stocks only rise.

"If there's been buying, and if stocks are being held by people who believe that they only go up, I think that bodes ill," Marks told CNBC.

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While the investor acknowledged that those types of traders are in the minority, he argued that "it's not healthy to have people who are buying stocks for fun."

"It reminds me of the people who were day trading in 1999 and declaring day trading a 'can't miss' strategy," Marks said. "The tech stocks crapped out in 2000."

Portnoy poked fun at Marks' comments in a tweet on Tuesday, accusing him of resenting day traders' success compared to veteran investors such as Warren Buffett.

"Another poor sad billionaire is mad that people are making a ton of money besides him and Warren," Portnoy said. "Poor old Howard."

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Marks' comments echoed those of the"Shark Tank" star Mark Cuban, the Omega Advisors boss Leon Cooperman, the Wealthfront investment chief Burton Malkiel, and the "Mad Money" host Jim Cramer, who have all warned day traders against getting carried away.

Trading platforms' shift toward zero commissions coupled with the closure of casinos and the suspension of live sports during the coronavirus pandemic have driven people to the stock market for entertainment.

However, some in the new crop of day traders have bought shares in bankrupt companies and made other risky bets, raising eyebrows in the investment community.

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