The Power of the “In” Crowd

No doubt you may have seen the chart below showing the outsized impact that a handful of tech names have had on the performance of the S&P 500. So, does that mean that the remaining 495 names in the S&P 500 are bad companies? Of course not. But it does show what happens when a handful of names make up 21% of the total market cap of the index.

Toothless Large Caps

Source: FactSet Research Systems Inc., 12/31/2014 to 12/31/2019
FANG stands for Facebook, Inc.,, Inc., Netflix, Inc., and Google (Alphabet Inc.).
All indices are unmanaged. It is not possible to invest directly in an index.
Past Performance does not guarantee future results.

Now, fast forward to a market where investors turn their focus to attractive valuations and overlooked businesses that are producing bottom-line growth. Under that scenario, just a 5% reallocation from large caps in the Russell 1000 with its $31 trillion market cap, to the small cap universe with just $2.1 trillion in aggregate market cap, could drive outsized returns from an asset class starving for attention.  
Please wait while we gather your results.


Michael Kops

Vice President and Partner


Email Sign Up


©2022 Heartland Advisors | 790 N. Water Street, Suite 1200, Milwaukee, WI 53202 | Business Office: 414-347-7777 | Financial Professionals: 888-505-5180 | Individual Investors: 800-432-7856

Past performance does not guarantee future results.

Investing involves risk, including the potential loss of principal.

There is no guarantee that a particular investment strategy will be successful.

Value investments are subject to the risk that their intrinsic value may not be recognized by the broad market.

The statements and opinions expressed in the articles or appearances are those of the presenter. Any discussion of investments and investment strategies represents the presenters' views as of the date created and are subject to change without notice. The opinions expressed are for general information only and are not intended to provide specific advice or recommendations for any individual. Any forecasts may not prove to be true.

Economic predictions are based on estimates and are subject to change.

Heartland’s investing glossary provides definitions for several terms used on this page.