Top six weighted companies in the S & P 500 Index account for 31.5% of the portfolio

Top six weighted companies in the S & P 500 Index account for 31.5% of the portfolio. I dub these companies “The PSYCHO 6”. To speculate on potential downdraft in market, on Friday I started a very small put option on the S&P 500 ETF (SPY) 'til Aug 31st (only God and members of the U.S. Deep State can time the market). See below for names and numbers. Source of financial data is https://slickcharts.com/sp500

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Is it too risky to buy the top 6 stocks and ignore 494 stocks in the 500 index?

No short term risk of the top 6 going to zero

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Depends on whether one is investing or merely day-trading/speculating (i.e. gambling).

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Investing not day trading

Adjust portfolio once a year

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They are real companies that provide valuable goods and services so they will not go to zero, but they could drop in price by 50% relatively quickly. I guess one could argue this is true of the entire S&P 500.

But the difference is that NVIDIA could be a CISCO and you could catch it at the top and be underwater 24 years later.

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The coolest thing about the Psycho Six is that fully one third of them add virtually zero value. If they disappeared from the face of the Earth, it would hardly be noticed after a brief period of adjustment. Arguably, if META and GOOG(L) vanished, the world would be a better place. A convincing argument could be made for some of the others.

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Agree 100%, this is speculating.

“Hard knocks” tuition is 0.1% of portfolio. If value of put option goes to zero, that is the most I would lose.

One day in, it is a bad position, losing 21% of its value.

Did I mention these “best” companies are:
chock full of DEI hires
pumped up in price by the AI hype.
Who knows, one or more of these companies may trade similar to CSCO in the year 2000 during the Internet hype era. ( Mettelus read my mind).

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25 days in and this has been MY WORST TRADE OF THE YEAR.
Thankfully I have a very very small position, and my BEST TRADE OF THE YEAR [SHOC (STRIVE U S SEMICONDUCTOR ETF)] is a bigger position and up, up, up … as of this writing.


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