A fundamental analysis of the U.S. stock market over the last century reveals a shocking imbalance. Only 3.7% of all public companies traded on exchanges from 1926 to 2025 generated all the net wealth for investors. The remaining 96.3% of stocks underperformed conservative short-term Treasury bills (T-bills) in the long run, traditionally considered the benchmark for a risk-free asset.
This is not a speculative claim, but the result of a large-scale analysis of 29,754 companies. The median return of all stocks over their entire history was negative: half of the stocks lost 6.9% in value. The average figure of 30,000% is an illusion created by a handful of superstars. For instance, just five corporations — Apple, Nvidia, Microsoft, Alphabet, and Amazon — accounted for over 20% of all accumulated market wealth. The famous "Magnificent Seven" contributed 24.2% of the total market capitalization created over 100 years.
Capital Concentration — The New Standard
The trend of market narrowing is intensifying. In 2016, half of the net wealth was held in the stocks of 89 companies. By 2025, that number had shrunk to 46, despite the total market capitalization growing from $43 trillion to $91 trillion. Nine years of Big Tech and artificial intelligence triumph have led to extreme capital concentration. Nvidia, which only held its IPO in 1999, together with Apple now controls a tenth of the market's entire historical profits.
The market has always been driven by a narrow circle of winners, but now that circle has narrowed to its limit. This creates systemic risk: a correction among leaders would automatically crash the entire index, masking the real state of the rest of the economy. For a crypto investor, there is an important lesson here: passive ownership of the S&P 500 index is no longer a guarantee of growth. Diversification across market segments and asset classes — including digital ones — is becoming a necessity, not a luxury.
My view: The U.S. stock market is turning into a "game for the chosen few," where 95% of participants are doomed to losses or stagnation. This confirms my long-standing position: sensible capital allocation should include not only traditional indices but also independent assets, such as cryptocurrencies, which are not tied to Wall Street's corporate hierarchy.