Key points
- The S&P 500 is weighted by market cap; its ten largest companies made up more than a third of the index by 2024.
- Moves in a few giant companies can drive the whole index.
- Market cap changes with earnings, valuations and new share issuance.
Example
The S&P 500's companies were worth roughly $50 trillion combined at the end of 2024, so a 1% move changed their value by about $500 billion.
In history
Apple first reached a $3 trillion market cap in January 2022, then fell close to $2 trillion a year later as rates rose. Because the index is weighted by value, swings in a handful of giants move it noticeably.
Related terms