Are the Magnificent 7 in bubble territory?

Investors have become increasingly worried about Magnificent 7 stocks. Tiffany Wade and Michael Guttag, portfolio managers at Columbia Threadneedle Investments, acknowledge that while these equities are not in bubble territory, concerns about market concentration are understandable. The S&P 500’s 10 largest companies make up 39% of the index’s total market capitalisation – surpassing levels seen during the 1999–2000 tech bubble. However, these companies' price-to-earnings ratios are higher than those recorded 25 years ago. The Magnificent 7 and broader tech prices have risen, with the largest...