by Andrew Bary, Barron's article:
The biggest keep getting bigger and more dominant.
The five technology giants that dominate the S&P 500 index -- Apple ( AAPL ) , Microsoft ( MSFT ) , Alphabet (GOOG), Amazon.com ( AMZN) , and Facebook ( FB ) -- accounted for a combined 22.9% of the index Friday, an apparent record. The data are from S&P Dow Jones Indices.
Three of the tech leaders -- Microsoft ( MSFT ), Alphabet, and Facebook ( FB ) -- hit new highs Friday as the S&P 500 reached a record.
Rarely has the S&P 500 been so concentrated at the top. The Big Five were a combined 21.7% at the end of 2020.
At year-end 2019, the five largest stocks in the index totaled 17.2% of the index. At that time, Berkshire Hathaway (BRK.B) was No. 5., not Facebook ( FB ), which now ranks fifth. At year-end 2018, the top five were 15.4% of the S&P 500 index (Berkshire again was fifth).
It is notable that at the end of 1999, right before the peak in tech stocks, the top five companies were 16.8% of the S&P 500. Those five stocks in order of size were Microsoft ( MSFT ), General Electric (GE), Cisco Systems (CSCO), Walmart (WMT), and Exxon Mobil (XOM). GE, Cisco, and Exxon are now nowhere near the top.
So far this year, Microsoft ( MSFT ) (up 30.2% through Friday), Alphabet (up 57.3% based on the nonvoting shares, GOOG) and Facebook ( FB ) (up 35.4%) are powering the leaders. Apple ( AAPL ) and Amazon ( AMZN ) were up about 12% year-to-date through Friday, behind the S&P 500's 17.5% gain.
M*'s X-ray tool reveals stock overlaps between funds and their percentages. I have not able to do that on M* site directly as in that past.
Take them out of the S&P and see what the rest of the 'market' (er, index) has returned....or not.
From your chart the "Lower 490" look as though they have not even made it back to Jan 2020 levels. Also, I believe historically the "Top Ten" stocks have regularly out weighed and - in good times - out performed the "Lower 490". Isn't that how market cap weight indexes work?
Market Cap-Weight verses Factor-Weight Indexes: market-cap-vs-fundamentals-etf-weighting-and-the-average-investor
Stay Kool, Derf
Anyway, I placed Fido's Over the Counter fund for a view compared to the whatever the composition of SPY may have been at the time. I dug through old paper documents, but could not find any info for the top 10 holdings of FOCPX at the beginning of 2000.
The chart shows the story in the high pricing and the steep drop. You will also note moving across the chart, the time frames for recovery periods. And 2008 was just around the corner.
FOCPX versus SPY January 2000 - 2007
Granted that investing, finance, business, and the economy are all different, so depending on the context, 'S&P index =! "the market"'.
FOCPX, SPY,VTSMX January 2000 - present
From the FOCPX semi-annual report dated January 31, 2000:
Thank you for the FOCPX data. I'm aware of EDGAR within the SEC; but have not used the site.