Top 10 US stocks as a percentage of the entire US stock market

in #economy9 months ago

People chat about how a handful of tech stocks dominate the US stock market, accounting for most of the market gains of the last five years. But how top-heavy has it got?

Here is a chart of the top ten stocks by market capitalisation, as a percentage of all listed stocks by market cap:


source

The last time the top ten were worth 75% of the entire market was in 1929, just before the legendary Wall Street crash.

This puts people who own index-tracker funds in a dangerous position. Yes they've ridden the tech boom upwards - but they are not diversified. All it takes is one or two tech stocks to make mis-steps and their value will evaporate.

Maybe it's time to cash in and sell.