For subscribers
Your ‘safe’ stock funds may be riskier than you think
Sign up now: Get ST's newsletters delivered to your inbox
The US stock market has become so concentrated that even broad index funds are no longer well diversified.
ILLUSTRATION: DAVIDE BONAZZI/NYTIMES
Jeff Sommer
Even if you have been doing everything right and diversifying your investments as the textbooks suggest, you may be taking a greater risk than you realise.
What’s happened is that a handful of companies, like Nvidia, Microsoft, Alphabet and Apple, have been driving stock returns. They, and a handful of other tech giants, including Amazon, Broadcom, Meta and Tesla, have become so valuable that their shares dwarf the rest of the market.
