Is market leadership shifting?
What this chart shows:
The increase in concentration of the S&P 500 since 2015 (left). Also shown are 2026 year-to-date returns of the Magnificent 7 stocks along with the S&P 500, S&P 500 Equal Weighted, and the Russell 1000 Value Indices (right).
Why it matters:
Recent market performance has largely been driven by a small group of mega-cap growth stocks. The “Mag 7” companies alone were responsible for more than 45% of the S&P 500’s return in each year from 2023 – 20251.
While this concentration has rewarded investors during periods of strong performance, it also creates risk for cap-weighted indices when these stocks move together on the downside.
2026 is showing signs of rotation, with both the equal- weighted S&P 500 and value stocks outperforming the traditional cap-weighted S&P 500, and more than half of the “Mag 7” companies underperforming.
Should participation continue to broaden, actively managed strategies with less concentration may help investors navigate periods of leadership rotation.
Related: The Data Is Clear: Earnings Have Driven Stock Prices for Decades
Source: Morningstar, FactSet. As of 4/30/26. concentration levels as of 12/31/2015 and 4/30/2026 – SPY ETF used as a proxy for S&P 500. Alphabet Class A and C combined as one holding. Total return indices used for S&P 500 and S&P 500 equal weighted. U.S. large cap value = Russell 1000 value total return index. 1- JPMorgan Guide to the Markets: Magnificent 7: performance, earnings and dispersion. Past performance does not predict or guarantee future performance. You cannot invest directly in an index. Company references are used for illustrative purposes and should not be construed as an endorsement. This information is not intended as an investment recommendation, nor does it constitute investment advice.