Is this the biggest concentration bubble in history?

Magnificent 7 stocks now account for 32% of the S&P 500 market value, near the all-time record

September 09, 2024

As reminder, market concentration means a given market's market share is held by a small number of companies.

Currently, Microsoft, Alphabet, Meta, Amazon, Apple, Tesla and NVIDIA or the so-called Magnificent 7 group share in the S&P 500 total market capitalization is ~32%, close to its all-time record seen several weeks before.

This share has increased by 10 percentage points in just 1.5 years.

This is even 10 percentage points HIGHER than the largest 7 stocks share during the 2000 Dot-Com Bubble.

In other words, a few stocks have been driving most of the S&P 500 gains over the last couple of years.

Such a large concentration poses significant risks for the entire stock market. These have been outlined in the analysis published in early July.

Interestingly, since then the S&P 500 has not been able to overtake its all-time highs.

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