Europe Capital Partners flags S&P 500 concentration as 35% of inflows go to seven stocks
SPY•Europe Capital Partners said seven companies receive $0.35 of each invested dollar in the S&P 500, while the index’s smallest members together represent 23.5%. Its note said passive inflows reinforce the concentration and questioned whether the same seven companies will lead over the next decade.
1. Index concentration concerns
Europe Capital Partners flagged rising concentration in the S&P 500, saying $0.35 of each invested dollar goes to seven companies, while the smallest index members together represent 23.5%. The note said passive inflows reinforce the trend and that active managers face higher benchmark risk if they are underweight the seven; it also questioned whether those companies will lead over the next decade.
