The Magnificent Seven, Nvidia Corp. (NASDAQ:NVDA), Apple Inc. (NASDAQ:AAPL), Microsoft Corp. (NASDAQ:MSFT), Amazon.com Inc. (NASDAQ:AMZN), Alphabet Inc. (NASDAQ:GOOG) (NASDAQ:GOOGL), Meta Platforms, Inc. (NASDAQ:META) and Tesla Inc. (NASDAQ:TSLA), now account for just over 30% of the entire U.S. stock market. That’s a level critics say leaves the S&P 500 dangerously dependent on a handful of mega-cap tech firms.
Some investors recommend rotating into equal-weighted strategies to pull back from equities altogether. Other experts, however, insist that today's concentration looks far less unusual when held up against market history.
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The Research
Elm Wealth CEO James White and CIO Victor Haghani on Monday highlighted research spanning nearly a century of U.S. market data. Today’s concentration levels, they argue, are well within historical norms.
“We think the concern about concentration is misplaced,” they wrote.
Mark Kritzman, an MIT lecturer, and David Turkington, head of State Street Associates, present a similar case. In a 2025 paper titled “The Fallacy of Concentration,” they show that the number of S&P 500 stocks has indeed fallen to near its lowest point since 1998. But they maintain that “the U.S. stock market has not become riskier as it has become more concentrated.”
Extend the analysis further back, and a different picture emerges, the market was at least as concentrated in the 1930s, 1950s, and 1960s as it is today.
A separate 2026 ...
