---
title: '30% of the S&P 500 is in just 7 Companies'
source: 'https://youtube.com/watch?v=CX0p62-74CA'
video_id: 'CX0p62-74CA'
date: 2026-08-05
duration_sec: 64
---

# 30% of the S&P 500 is in just 7 Companies

> Source: [30% of the S&P 500 is in just 7 Companies](https://youtube.com/watch?v=CX0p62-74CA)

## Summary

The video explains that the S&P 500 ETF is heavily concentrated in a few large tech companies, with Nvidia, Apple, and Microsoft alone making up a significant portion of the index. It compares the performance of the market-cap-weighted S&P 500 with equal-weight ETFs over the past decade, showing that concentration has historically boosted returns. The video aims to inform investors about what they actually own when they buy an S&P 500 index fund.

### Key Points

- **S&P 500 Concentration** [00:01] — The S&P 500 ETF is weighted by market cap, so larger companies have a proportionally larger share. Nvidia, Apple, and Microsoft make up 7.41%, 6.74%, and 4.62% of the index respectively.
- **Diversification Illusion** [00:14] — Owning the S&P 500 is often considered diversified, but in reality, it's a bet that big tech continues to perform well due to the heavy weighting of a few companies.
- **Equal Weight ETFs** [00:29] — Equal weight ETFs give each company the same allocation of dollars, avoiding concentration. However, over the past 10 years, the standard S&P 500 returned 212%, while the equal weight version returned less, indicating concentration boosted returns.
- **Performance Comparison** [00:41] — The concentration in the S&P 500 didn't hurt investors in the past decade; it actually improved returns compared to equal weight alternatives.
- **Investor Takeaway** [00:55] — The video is informational, not a recommendation to switch funds. It aims to show what you own when buying the S&P 500. If the tech concentration makes you nervous, you can consider alternatives, but these companies are not the worst to invest in.

### Conclusion

The S&P 500's performance is heavily influenced by a handful of tech giants, and while this concentration has historically benefited investors, it's important to understand the actual risk profile of what you own.

## Transcript

S&P 500 ETF, almost 300 of that is going companies. The ETF is weighted by market cap, so companies with higher market capitalizations make up proportionally more of the index. So, as you can see
here, Nvidia, Apple, and Microsoft, they make up 7.41%, 6.74%, and 4.62% [music] of the weighting, and so on. So, when people say they're diversified by owning the S&P 500, they're really just betting that big tech continues [music] to
perform well. Now, there are equal weight ETFs, which means that of your gets the same allocation [music] of dollars. But, here's the thing, if you go with that option, over the past 10 years, the normal S&P 500 has returned
212%, while the equal weight version returned So, the concentration didn't hurt you in this time period, it just made you more switching funds, it's more of a video to let you know what you actually own if
you buy the S&P 500. If that much tech makes you nervous, you can always they're not the worst companies to invest in. Just my opinion.