by Daendrew
98% of S&P 500 gains come from just 6 companies.
www.cnbc.com/2018/07/10/amazon-netflix-and-microsoft-hold-most-of-the-markets-gain-in-2018.html
When you take that into account, it is even more impressive that SFLNX, the Schwab Fundamental US Large Company Index Fund has held up the way it did vs S&P 500 and Russell 1000 as the fundamental indexes have significantly less exposure to these high flyers.
The PE multiple is closer to historical levels with the Fundamental Index at 16 times earnings vs 22 times income for the total market.
Would it be prudent to put a percentage of equities into fundamentally weighted indexes? There is much more room to grow at 16x than 22x multiples.
There is a Persian proverb that states when you sleep on the floor you don’t fall out of bed. If there is a correction of 25-50% would fundamentally indexing help lessen the blow?