Future Proof Weekly – Stock Market Breadth, Tax Independence

The narrative about a small portion of stocks driving the entire market has come and gone over the past few years. But 2023 is an outlier year.

In 2020 12% of stocks drove the entire return for the S&P500.

But in 2023…

1% drove the entire return! 5 stocks

Number of stocks accounting for the S&P 500's gain by year:

2017: 203 stocks (40%)
2019: 328 stocks (65%)
2020: 60 stocks (12%)
2021: 258 stocks (52%)
2023: 7 stocks (~1%)

This isn't a normal bull market https://t.co/WOv1JbPvBc

— Nick Maggiulli (@dollarsanddata) June 20, 2023

Those 5 companies are on average up 56.2% in 2023 compared to the S&P500’s 8.9% return

So the question is “is there any action we should take as a result of this”

The answer is likely no. Unless you’re concentrated in those 5 stocks you may want to take some money off the table to rebalance.

Tax Independence Day

This chart has been circling through Twitter

Tax Independence day is June 19th. Meaning from June 19th for the rest of the year the income you earn actually goes to you, not the government!

Canadians need to decide for themselves whether they are getting their money’s worth when it comes to how governments are spending their tax dollars.

Learn more: https://t.co/bcaV5sY2H9#canada #cdnpoli #taxfree #taxfreedomday pic.twitter.com/TfsoyUwdN4

— The Fraser Institute (@FraserInstitute) June 20, 2023

A pretty powerful message when you structure it this way