Market Capitalization of Six Largest Companies as Share of S&P 500 Total

Market Capitalization of Six Largest Companies as Share of S&P 500 Total With the six largest companies accounting for 29% of the S&P 500’s total market capitalization, discussions about diversification have become increasingly relevant. A well-diversified portfolio is vital for effective risk management. Image: Goldman Sachs Global Investment Research

U.S. Stocks – Average Stock Correlation in the S&P 500

U.S. Stocks – Average Stock Correlation in the S&P 500 The current trend in the S&P 500 indicates a significant rise in stock correlation, suggesting a more homogenous market behavior that could pose risks for investors relying on diversification strategies. Image: Goldman Sachs Global Investment Research

The Five Largest Stocks in the S&P 500

The Five Largest Stocks in the S&P 500 The concentration of the S&P 500 in the 5 largest stocks is higher than it was 60 years ago, which is considered a potential risk, as it may result in increased market volatility and a lack of diversification. Image: Bianco Research

Infrastructure Flows

Infrastructure Flows Infrastructure funds have seen their largest inflow since June 2022, signaling a positive trend for investors aiming for long-term returns and portfolio diversification. Image: BofA Global Investment Strategy

S&P 500 Equity Risk Premium

S&P 500 Equity Risk Premium Despite potential in U.S. equities, the decline in equity risk premium suggests caution is needed, prompting diversification across asset classes for risk management. Image: BofA Global Research

Top 5 Stocks as % of S&P 500 Market Capitalization

Top 5 Stocks as % of S&P 500 Market Capitalization The S&P 500 remains more concentrated in the five largest stocks than during the dotcom bubble, posing potential risks if these stocks underperform and raising concerns about diversification and market stability. Image: Morgan Stanley Wealth Management

Equity Total Returns

Equity Total Returns Geographic diversification hurt equity performance last year. Image: Richardson Wealth

20-Year Annualized Returns by Asset Class

20-Year Annualized Returns by Asset Class The average American investor still underperforms the market over the long term, generally due to panic selling, emotional biases, the herding effect and lack of diversification. Image: J.P. Morgan Asset Management

Correlation Across Assets

Correlation Across Assets The 1-year rolling correlation remains low between asset classes for diversification. Image: Goldman Sachs Global Investment Research