None
EN
When a few stocks become the market
[]
Atlantic Council
Economy & Business Econographics Print this page When a few stocks become the market By Bart PiaseckiThe S&P 500 has 500 companies, the Nikkei 225 has 225, and the STOXX Europe 600 lists, you guessed it, 600.
Yet stock market concentration is rising, with a much smaller group of companies and sectors increasingly influencing whether many of the world’s major indices go up or down.
A South Korean wake-up callLast month’s stock market meltdown in South Korea showed how quickly market concentration can turn from a strength into a vulnerability.
South Korea may be the most recent example of a market facing concentration risks, but it is not an isolated case.
Moreover, the largest companies operate across a wider range of industries and have broader revenue streams.