You should not put all your eggs in one basket, we have always told savers. The investors' favorite basket has five hundred eggs, but ten of them weigh almost half the lot. According to data from Citadel Securities imaged by The Kobeissi Letter, 41 cents of every dollar invested in the S&P 500 goes to the ten largest capitalizations in the index. Nvidia captures 8 alone. Do you hold an S&P 500 ETF, perhaps housed in a PEA? This graphic concerns you directly.
Where your dollar actually goes
The detail is worth a look, as presented in the graph published by The Kobeissi Letter. Behind Nvidia come Apple (7 cents), Microsoft and Alphabet (6 cents each), then Amazon (4 cents). Broadcom, Meta, Tesla, Micron and AMD share the next 10 cents.
Let's go down one floor. The ten companies ranked eleventh through twentieth receive 10 cents. So 20 companies absorb 51 cents, more than half of your dollar. The next eighty receive 26. At the bottom, the 402 smallest share 23 cents. This is less than the first four combined.
Another possible reading. Four chipmakers, Nvidia, Broadcom, Micron and AMD, weigh in at 14 cents. Buying âthe American marketâ today amounts to taking a big ticket on artificial intelligence, with a little soda and laundry detergent around.
A concentration of the S&P 500 never seen before, even in 2000
Wall Street has experienced fevers before, never at this temperature. According to the Goldman Sachs Asset Management series, the top ten stocks weighed around 22% of the index in 1973, at the time of the âNifty Fiftyâ, and 27% at the peak of the Internet bubble in 2000. This summer, the readings oscillated between 36.5% and 41% depending on the calculation methods. Citadel Securities rounds up to 41 as of October 6, 2026.
The first three lines, Nvidia, Apple and Microsoft, together represent 21% of the index, a record noted by the Benzinga site. In the mid-1980s, the trio of IBM, AT&T and Exxon peaked at 13.4%.
Why such excitement? Because the index weights each company by its stock market value. The higher a stock goes, the more it weighs, and the more funds that track the index must buy. The mechanism maintains itself, while Wall Street keeps setting records.
Concentration of the S&P 500: should we be worried?
The honest answer is nuanced. The two most famous concentration peaks, 1973 and 2000, preceded long bear markets. Two examples do not make a law, and a concentrated index is not doomed to fall. It simply depends on the health of a handful of companies.
And that's where the problem lies. If Nvidia coughs, your ETF catches a cold, regardless of the performance of the last 402 lines. There is a version of the index where each company weighs the same, called equal-weighted, which corrects this bias at the cost of much less exposure to the tech giants.
Cryptocurrency investors are familiar with this debate. A âdiversifiedâ crypto portfolio often remains a bet on bitcoin wearing a false mustache, as the rest of the market follows its trajectory.
