Was the recent trend of growth stocks outperforming value stocks an anomaly, driven mainly by lower capital costs that favored growth over profitability?
As shown below, history shows that US value outperformed US growth most of the time (using rolling 10-year Total Return) Source: Tavi Costa, BofA
Large tech stocks just keep getting bigger: The S&P 500 Equal Weight index relative to the S&P 500 is now at its lowest level since the 2008 Financial Crisis
This ratio has accelerated as the S&P 500 has rallied by 14% year-to-date while the equal-weight by just 5%. The disconnect has been driven by the 5 largest stocks which have seen a 32% gain combined this year. Since January 2023, the S&P 500 is up a massive 41% while the equal-weight index is up just 16%. At the same time, Russell 2000 Equal Weight is nearly flat, up just ~3%. Source: The Kobeissi Letter, The Daily Shot
U.S. household stock allocation has reached an all-time high
Source: NDR_Research
Gautam Adani is uber-bullish on indian equities "There has never been a better time to be Indian"
Source: Nikhil Oswal
Here are the most held stocks by hedge funds
Source: Savvy Trade, Visual Capitalist
Is diversification a thing of the past? The sp500 has significantly beaten money managers who diversify investments globally in 13 of the last 15 years
The only 2 years where diversification worked over this period were 2012 and 2023. Such a streak has never happened before. During the 15-year timeframe, the largest outperformance by the S&P 500 occurred in 2015, by nearly 30%. Meanwhile, the S&P 500's return has exceeded global investment assets by 15% year-to-date. Source: The Kobeissi Letter, Bloomberg
For nearly a decade, this group traded in a very narrow price-to-sales range, but it's different this time???
Source: Lawrence McDonald, Bloomberg
The market cap of technology stocks as a percentage of the S&P 500 just hit a record 44%
This percentage is now ~12% higher than after the 2000 Dot-com bubble peak of 32%. Over the last 10 years, this share has more than DOUBLED. Also, since 2014 Nasdaq 100 has added 426% compared to a 182% gain in the S&P 500. Are tech stocks set to account for the majority of the S&P 500? Source: The Kobeissi Letter
