Is a trillion dollar exposure concerning?

Hello Reader, I’m guessing you’ve probably seen a chart that looks something like the one below. [image] If you haven’t, the message is simple: Five stocks (Facebook, Apple, Amazon, Microsoft, and Google) account for about a quarter of the market capitalization of the S&P 500, which consists of 500 companies. This is because of their respective massive market values. Apple is worth $2.8 trillion, Microsoft is worth $2.4 trillion, Google is worth $1.8 trillion, Amazon is worth $1.6 trillion, and Facebook is worth $876 billion. For some context, the 20 smallest companies in the S&P 500 are each worth less than $10 billion. The idea that 1% of the companies in the index account for about 25% of the total market value is scary for some investors. But should you honestly be worried? Two things to consider: First, there isn’t much evidence that shows a relationship between market concentration and forward market returns. Second, market concentration isn’t unusual. In fact, companies used to represent even bigger shares of the market back in the day. AT&T was 13% of the total U.S. stock-market value back in 1932. Another important consideration is that ungodly earnings prop up these valuations. While these so-called FAANG companies account for 1% of the names in the S&P 500, they account for a whopping 14% of the index’s earnings. Like the S&P 500, the biggest five stocks in the U.S. market attract raised eyebrows because of the trajectories of their prices. But a closer look at things like business diversification and earnings show that these concerns may be a bit overblown. If you have the capital available, now might be a good time to consider sinking your teeth into some of these FAANG stocks. [image] Andrew Graham Editor, Silver Ridge Market Report P.S. [Claim your free copy]() of Unstoppable Prosperity now. This free 279-page book reveals a time-tested, proven strategy that can help you capitalize on the generational opportunity available today to [help you thrive in all stock market conditions](=). 316 Media and Silver Ridge Market Report, is not giving individualized financial advice. Never invest more than you are willing to lose. 316 Media or Silver Ridge Market Report is not giving financial, investment, or stock advice. Our content is designed for generalized informational purposes only. If you have specific questions about investments or stocks you should consult a financial advisor. Articles, News, Or Other published materials are not always the views of 316 Media and/or Silver Ridge Market Report. If you feel you are receiving these emails in error please email Support@SilverRidgePro.com or click the unsubscribe button below. [Unsubscribe]( Silver Ridge Media 30 N Gould St, Ste R Ste R Sheridan, Wyoming 82801 United States