The S&P 500 Is the Most Concentrated Since 1932, According to Goldman Sachs. History Shows What Should Happen Next, but I Think This Time Is Different. Here's Why.

Institutional investors at hedge funds or wealth management firms can make a fortune picking the right stocks at the right time. Most people, however, lack the resources available to financial services companies, or the time to do their own due diligence before making an investment. For these reasons, investing in an index fund that tracks the S&P 500 (SNPINDEX: ^GSPC) is generally enough for the average investor to not only get started on their financial journey, but also build wealth over time.Investing in the S&P 500 provides a level of diversification that's hard to achieve owning a select number of individual stocks. It minimizes portfolio risk because your capital isn't as vulnerable to setbacks that could hurt any particular sector or specific businesses.Nevertheless, from time to time indexes can be disproportionally weighted by a small cohort of stocks. Right now, that's exactly what is happening in the S&P 500.Continue readingWeiter zum vollständigen Artikel bei MotleyFool Weiter zum vollständigen Artikel bei MotleyFool