MP006: The Three Trillion Dollar Club

As of this month, there are only three companies in the world that have achieved a market capitalization (market value) of over $3 trillion: Nvidia, Microsoft, and Apple. One thing these companies have in common is artificial intelligence.  

In this Market Perspective episode, Vector’s Jason Ranallo discusses past and present concentrations of market leadership.

We look back 30 years to companies like General Motors, Cisco Systems, and General Electric. At the time, these blue chips were some of the largest in the market. They came out of a century that saw the mass adoption of cars, radio, and the electrification of cities. What we know today is that these companies are no longer leading the index. 

Changes in market leadership typically occur over time, either from companies rising in market value or others falling. Today’s AI darlings, and more broadly, the so-called Magnificent 7 (Apple, Nvidia, Microsoft, Amazon, Alphabet, Meta, and Tesla), are leveraging AI, computing, and scaling networks. Will they always? If history is a guide, no. But this doesn’t mean the three trillion-dollar club is going anywhere, either.  

If you or someone you know has questions about concentrated positions in markets or in their portfolios, listen to this podcast, share, and let us know. At Vector, we help clients answer these questions and plan for the future. 

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