Capstone Investments – Dec 17 2025
By Bryce Pease CFP® Accredited Investment Fiduciary® Casey Morris CFP® Capstone Pacific Investment Strategies, Inc. California, Colorado, Nebraska
In our last message on Dec 5 we talked about artificial intelligence (AI), how it’s in the news a lot lately and how many people wonder if it will replace their jobs someday. To continue the discussion let’s rewind back to October 14, 2022. The S&P 500 closed at 3,583 that day.¹ No one knew it, but it was the bottom of a 10-month bear market. But what has driven this bull market? This is where things get interesting.
When we talk about the stock market going up or down, we often envision it as a single entity moving in one direction. But this isn’t really an accurate way to think of stocks. At any given time, some stocks will be moving up, and some will be moving down. If more stocks are moving in one direction than another, then that’s typically what drives the overall direction of the market.
Sometimes, a mere handful of stocks moving in a big way can drag the overall index along with them. That’s been the case with this bull market. For several years, the majority of the market’s growth has been due to a small number of companies: Alphabet (Google), Amazon, Apple, Meta (Facebook), Microsoft, Nvidia, and Tesla. Often referred to as the Magnificent Seven, these companies represent roughly 35% of the S&P 500’s total value.² If you add the next three largest, Broadcom, Oracle, and Netflix, that figure rises to 40%.3
Think about that number for a moment. An index of five-hundred companies, but with only ten making up 40% of its total worth. On the surface, you might think all these companies are very different from one another. But nearly all of them have one thing in common: They are investing billions of dollars into AI. More on this in our next message.
Casey and Bryce
402-207-5383 info@capstonepacificinc.com
Different types of investments involve varying degrees of risk and there can be no assurance of future performance of any specific investment, investment strategy, or product made reference to in this commentary. Any mention of a particular security or type of security is not a recommendation to buy or sell that security. Investing involves risks including the possible loss of capital.