Public Equity Concentration Raises Concerns
According to UBS data cited in Private Equity Wire, the 10 largest stocks in the S&P 500 account for close to 40% of the index’s total market capitalisation. This share exceeds the 25% level recorded during the dotcom era and the 15% level seen in 1980. Samsung and SK Hynix together accounted for around 60% of South Korea’s stock market in Q1 2026.
Shift Toward Private Markets
A 2026 Schroders survey found that half of equity and credit investors look across both public and private markets to meet portfolio objectives, according to Private Equity Wire. Private markets lack direct exposure to the Magnificent 7 stocks. However, the MSCI Global Venture Capital Index showed top-10 holdings at 17.7% of index NAV in Q1 2026 before the SpaceX IPO, while IT accounted for around 43%.
Sector and Company Exposure in Private Capital
In large US buyouts, the share of investments in software rose from less than 20% to nearly 50% during covid. This pattern does not apply to European buyouts or small and mid-sized US buyouts. Endowments that made large allocations to VC funds can end up with concentrated exposure when portfolio companies generate 50x or 100x returns.
Listed Private Equity Structures
In April, Saba Capital succeeded in ousting the board of Baillie Gifford-managed Edinburgh Worldwide Investment Trust after the trust’s SpaceX position exceeded 10% of NAV. SpaceX reached an $800bn implied valuation in an employee tender and $1.77tn in its IPO. HarbourVest Global Private Equity maintains 1000 individual company positions with its largest single exposure at 1.6% of NAV; reaching 25% of 2025 value creation would require the top 50 companies, according to Private Equity Wire.
