SPY - Time To Buy Small And Mid-Cap Stocks? Cathie Wood Sees Broadening Rally After Market Concentration Exceeds 1932 Great Depression Levels | Benzinga
The U.S. markets have been on a tear this year, carrying over the momentum from 2023, when the S&P 500 gained more than 24%. However, the peculiarity of the gains seen in the current bull cycle is the top-heaviness of the market. Ark Invest founder Cathie Wood weighed in on the pattern in the firm’s monthly market update webinar that aired on Wednesday.
Extreme Concentration: The market concentration has reached an extreme, she said, pointing to a chart comparing the market cap of the largest stock relative to the 75th percentile stock.
The chart on the same compiled by Goldman Sachs and shared by the X handle of Kobeissi Letter showed the market cap of the largest stock was 750 times the market cap of a 75th percentile stock, which refers to a stock generating better returns than 75% of the stocks. The current stock concentration was higher than what was seen during the previous peak that ...