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Implications of rising market and sector concentration

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The five largest S&P 500 stocks saw their weight in the index jump from 16.3% to 22.0% in 2020 and still comprise over one-fifth of the index's market cap. The general trend of falling sector concentration that began in the early 2000s has started to reverse for many sectors. The rise of cyclical Growth sectors in the S&P 500 has corresponded with a rise in the sectors' share of R&D and capex spending.

Ned Davis Research | Special Report | Mixed

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