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186 sats \ 3 replies \ @grayruby 3 Mar \ on: Charted: S&P 500 Market Concentration Over 145 Years Stacker_Stocks
This is a symptom of passive investing. There is not much breadth in the market anymore.
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80 sats \ 2 replies \ @0xbitcoiner OP 3 Mar
I don't quite see the connection between passive investment and this concentration. Isn't it more the sales dominance of these 10 companies?
https://www.investopedia.com/ask/answers/08/find-stocks-in-sp500.asp
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218 sats \ 1 reply \ @grayruby 3 Mar
Winners continue to win even though their stock prices get ahead of their true value because there is a persistent market cap weighted bid regardless of price from passive funds.
Clearly they are all huge companies I am not saying they shouldn't be the top companies but if you were building a portfolio for yourself with 500 stocks would you allocated 26% of that portfolio to 5 of them. Probably not.
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40 sats \ 0 replies \ @0xbitcoiner OP 3 Mar
... there is a persistent market cap weighted bid regardless of price from passive funds.
indeed. now i get it! Like a snowball effect.
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