4 ms·
>I don't think index fund investors are the cause of Amazon's growth. Sure they are. Index funds are not equally weighted. Practically every tech ETF you can
by aphextron 8y ago
>I don't think index fund investors are the cause of Amazon's growth.
Sure they are.
Index funds are not equally weighted. Practically every tech ETF you can buy has Amazon weighted in the top 10, sometimes over 10% of total assets [0] whereas the average for other securities is below 1% at the most.
[0] https://money.usnews.com/funds/etfs/large-growth/invesco-qqq-trust/qqq https://money.usnews.com/funds/etfs/large-growth/invesco-qqq...
- votepaunchy 8y agoThe OP cites "S&P 500 or some total market fund", which are market-cap weighted.
- aphextron 8y agoIrrelevant. The market cap is still affected by large scale automated passive investing.
- jonknee 8y agoWhat do you consider equal weighting? Amazon is the second most highly valued public company in the world, should it be counted the same in the index as Fossil Group (one of the smallest S&P 500 companies with a market cap of $1.15b)? To me that would make no sense and would make you hugely underweight AMZN and hugely overweight FOSL.