S&P 500 Top 5 Stocks’ Weight vs. 1-Year Forward Returns While the current high market concentration is a significant feature of today’s market landscape, it doesn’t necessarily predict poor performance in the near term. Image: Goldman Sachs Global Investment Research
Fed Funds Rate Goldman Sachs expects the Fed to implement two 25 basis point rate cuts in 2025, with an additional cut projected for 2026. How will the Fed navigate potential increases in trade tariffs under the Trump administration? Image: Goldman Sachs Global Investment Research
Contribution to Annual S&P 500 Return The ten largest stocks in the S&P 500 have significantly influenced its performance in recent years, driving returns while raising important questions about the risks associated with market concentration. Image: Goldman Sachs Global Investment Research
S&P 500 Valuation Metrics While the current forward P/E ratio of 21.6x for the S&P 500 is high by historical standards, it has moderated somewhat from its recent highs. Image: Goldman Sachs Global Investment Research
Indexed Return The Magnificent Seven have undeniably shaped the landscape of the S&P 500, contributing to its impressive performance this year while also introducing risks associated with market concentration. Image: Goldman Sachs Global Investment Research
Active vs. Passive Fund Flows The trend of investors shifting from active to passive funds has accelerated significantly over the past decade, driven by cost considerations, performance outcomes, and evolving market practices. Image: Goldman Sachs Global Investment Research
MSCI Cyclicals/Defensives Return During anticipated economic expansions, investors lean towards cyclical stocks for their growth potential, while defensive stocks serve as a buffer during economic downturns. Image: Goldman Sachs Global Investment Research
Buybacks Over the past two decades, share repurchase programs have become increasingly popular among U.S. corporations, with the trend showing no signs of slowing down. Image: Goldman Sachs Global Investment Research
S&P 500 Volatility The concentration of large-cap stocks has significantly impacted market volatility, with these stocks accounting for a record share of it. Image: Goldman Sachs Global Investment Research
Top 10 Stocks as % of S&P 500 In recent years, there has been a substantial rise in concentration among the top 10 companies in the S&P 500, which has raised concerns about potential risks to investors. Image: Goldman Sachs Global Investment Research
Share of U.S. Corporate Profits from Foreign Markets Foreign markets, including emerging markets, significantly contribute to the profits of U.S. corporations. Specifically, they account for 16% of U.S. corporate profits, with emerging markets making up 4% of these profits. Image: Goldman Sachs Global Investment Research