The "Magnificent Seven" Have Made the S&P 500 More Concentrated Than Ever. Historically, That's Bad News for Stocks.
When examined over multidecade periods, Wall Street's three major stock indexes -- the Dow Jones Industrial Average (DJINDICES: ^DJI), S 500 (SNPINDEX: ^GSPC), and Nasdaq Composite (NASDAQINDEX: ^IXIC) -- are undeniable moneymakers. But when explored over shorter spans, the performance of these indexes becomes unpredictable.
Since this decade began, the major stock indexes have teetered between bull and bear markets on a number of occasions. While 2023 has been a relatively good year for the benchmark S 500 and growth stock-fueled Nasdaq Composite, a number of potential warning flags have emerged. Perhaps none is waving more frantically than the steadily increasing concentration of the S 500.
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Source Fool.com