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The influence of FAANG stocks on broad market performance

The influence of FAANG stocks on broad market performance

Facebook, Amazon, Apple, Netflix, and Google are collectively referred to as "FAANG" stocks.  They have had tremendous gains over the past 10 years.  Check out this article from DFA to see how much FAANG stocks have influenced the returns of the broad market. However, it is common for a small group of stocks to power the market.  The article also shows how the market would have fared if we exclude the top 10% and 25% of stock performers over the last 25 years.  The takeaway is that if you're portfolio is too concentrated, you may actually miss out on the higher returns the market has to offer.