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Thursday, May 25, 2017 6:25:10 PM
Five Largest Stocks Account For Nearly Half Of 2017’s Gains
By Bespoke | May 25, 2017
The market has seemed pretty top-heavy lately. We think the concerns around weak breadth have been a little bit overstated, though, as we mentioned in our Chart of the Day yesterday. But it’s still worth asking the question: how much of the market’s gain is attributable to the largest stocks? Below we show three series. The light blue line is returns for the S&P 500 YTD. In the dark blue line, we strip out the performance contribution of the five largest stocks in the S&P 500: Apple (AAPL), Facebook (FB), Amazon (AMZN), Microsoft (MSFT), and Alphabet (GOOGL). As shown, while the overall index is up almost 8% so far in 2017, it’s up only 4.6% if you strip out the five largest stocks. In the red series below we show the spread between the two, in other words, the cumulative performance contribution from those 5 stocks. At the start of the year, these five stocks accounted for 11.6% of the index’s market cap, so you’d expect a non-trivial percentage of gains to come from them. That share stands at about 13.7% today. Generating nearly half of the index’s gains with less than 15% of its market cap is an out-sized contribution and shows just how painful it can be in terms of relative performance if you’ve been underweight these mega-Tech behemoths.
https://www.bespokepremium.com/think-big-blog/five-largest-stocks-account-for-nearly-half-of-2017s-gains/
• DiscoverGold
By Bespoke | May 25, 2017
The market has seemed pretty top-heavy lately. We think the concerns around weak breadth have been a little bit overstated, though, as we mentioned in our Chart of the Day yesterday. But it’s still worth asking the question: how much of the market’s gain is attributable to the largest stocks? Below we show three series. The light blue line is returns for the S&P 500 YTD. In the dark blue line, we strip out the performance contribution of the five largest stocks in the S&P 500: Apple (AAPL), Facebook (FB), Amazon (AMZN), Microsoft (MSFT), and Alphabet (GOOGL). As shown, while the overall index is up almost 8% so far in 2017, it’s up only 4.6% if you strip out the five largest stocks. In the red series below we show the spread between the two, in other words, the cumulative performance contribution from those 5 stocks. At the start of the year, these five stocks accounted for 11.6% of the index’s market cap, so you’d expect a non-trivial percentage of gains to come from them. That share stands at about 13.7% today. Generating nearly half of the index’s gains with less than 15% of its market cap is an out-sized contribution and shows just how painful it can be in terms of relative performance if you’ve been underweight these mega-Tech behemoths.
https://www.bespokepremium.com/think-big-blog/five-largest-stocks-account-for-nearly-half-of-2017s-gains/
• DiscoverGold
Information posted to this board is not meant to suggest any specific action, but to point out the technical signs that can help our readers make their own specific decisions. Your Due Dilegence is a must!
• DiscoverGold
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