Amazon, Apple, Google, Microsoft and Nvidia (5 largest stocks) COMBINED now account for a record 27% share of the S&P 500.
This is up from ~19% in just 2 years.
In 2015, the percentage of 5 largest stocks was just 11%.
It is 9 percentage points higher than in Dot-com bubble. pic.twitter.com/ywNf927cWE
— Global Markets Investor (@GlobalMktObserv) June 4, 2024
B of A DESK: “.. fragility in tech stocks (recall $CRM and $DELL -4.5 and -3.5 stdev on earnings) is near 30-year+ extremes today, both in terms of frequency and magnitude. Index vol continues to underprice this correlated shock risk.” pic.twitter.com/URzBajTpJu
— Carl Quintanilla (@carlquintanilla) June 4, 2024
The dominance of the Big Tech Players in the S&P 500 has reached unprecedented levels. Let’s break down the numbers:
- Current Share (2024): As of now, Apple, Microsoft, Amazon, Meta (formerly Facebook), Google’s parent company Alphabet, and Nvidia collectively account for approximately 26% to 30% of the S&P 500 index. The exact percentage may vary slightly depending on the source and the specific date.
- Growth in Recent Years:
- In 2015, these same tech giants held a combined share of only 11% in the S&P 500.
- Fast forward to today, and their collective influence has surged to 27% or more, representing a remarkable increase in just two years.
- Comparison to the Dot-com Bubble:
- The current level of concentration is 9 percentage points higher than during the infamous Dot-com bubble of the late 1990s and early 2000s.
- Back then, technology stocks were soaring, but the market eventually experienced a significant correction.