It's Not Justy Alot of Apple You Likely Own in Your Portflio

I posted recently about the large and growing weighting to Apple (AAPL) in the market weighted indices like the S+P 500.


Not surprisingly this is not true just of Apple but of the technology sector in general. The market has been led by what is referred to as the FANG stocks (Facebook, Amazon,Netflix and Google) In fact the more accurate acronym is FAAG (Facebook, Apple,Amazon and Google )..since even despite its large price increase this year,Netflix has a far lower market capitalization and thus weighting in the indices.
In fact Microsoft which is the second largest holding in the S+P 500 (after AAPL) and had a 27% increase in price this year strarting this year at the 52 week low and now at the 52 week high. The  S&P is top heavy with f the entire technology srctor.

From the WSJ

Led by Apple Inc., Facebook Inc. and their peers, the weighing of technology stocks in the S&P 500 index has climbed to 23.8% as of Dec. 26, from 20.8% at the end of last year, according to S&P Dow Jones Indices.



Those looking to balance out the exposure to large cap technology in their portfolio might look at adding the following smart beta ETFs (technology weighting listed in parantheses).:

Large Cap ETFs:

USMV mimimum volatility (12.02%)
QUAL quality                       (18.6%)


and Small Cap Value             (10%)

Not surprisingly MTUM momentum has a technology weighting of 28.7%