Investors face ‘a scary, out-of-whack’ scenario

johnN

https://www.marketwatch.com/story/investors-face-a-scary-out-of-whack-scenario-just-look-at-this-chart-2020-07-12

Investors face ‘a scary, out-of-whack’ scenario — just look at this chart

‘Just as these stocks pulled up the entire market, they can pull down the entire market by their sheer weight’

Where we're headed, nobody knows.


AAPL
+0.24%
MSFT
-0.30%
AMZN
+0.54%
GOOG
+2.03%
FB
+0.23%
DJIA
+1.43%

If it weren’t for the “Giant 5,” your money would have been better off sitting in cash than the stock market over the past few years, according to Wolf Richter of the Wolf Street blog.






The Giant with moderate gains recently,
Interesting chart
Wondering if tech downfalls soon follow

rforno

And that, ladies and germs, is why I refuse to hold market-cap weighted funds like index funds....

davfor

In a similar vein, here are a couple excerpts from something I just read:

"It seems like we have dodged a bullet, yet a look under the surface reveals a much sicker market....the S&P 500 is still down 1.88%, but TPA's BIGTECH Index (the top 8 stock in the NASDAQ 100 by market cap) is up an astonishing 48.99% year to date (YTD)....these 8 stocks represent $8 trillion in market cap, which is 29% of the market cap of the S&P 500 ($27.3 trillion). TPA ran the numbers to see just what effect these 8 stocks have had on an index of 500 stocks. The BIGTECH effect has been to add 8.71% of performance to the S&P 500 YTD.

From: This Is Nuts... Again. Reducing Risk As Tech Goes 1999

https://seekingalpha.com/article/4357982-this-is-nuts-again-reducing-risk-tech-goes-1999?utm_medium=email&utm_source=seeking_alpha&mail_subject=must-read-this-is-nuts-again-reducing-risk-as-tech-goes-1999&utm_campaign=nl-must-read&utm_content=link-0