👉 Background: Nvidia was founded in 1993, specialising in graphics processing units (aka GPUs) for gaming. By the mid 2010’s, it began investing heavily into using its computer chips for AI.

👉 What happened: Nvidia's market value has grown to more than $3.6 trillion, making them the most valuable company in the whole wide world (cya later Microsoft and Apple). Now Nvidia has announced its third quarter revenue of just $35.08 billion USD — that’s a 94% year-on-year increase.

👉 What else: But interestingly, Nvidia’s share price actually dropped 2% after these results. And given Nvidia is now the largest company in the world, its results hold a LOT of sway in the overall market.

What's the key learning?

💡Right now, a handful of companies hold the keys to the entire global stock market. In fact, Nvidia alone accounts for 6.7% of the S&P 500 index.

💡But it gets worse because ten stocks make up 30% of the S&P500 index. With so much market concentration in so few companies, it creates a significant risk for diversified investment portfolios.

💡The successes and failures of many investments are now tied to a small group of tech giants. For example, if these companies face a downturn, it could ripple through the entire economy. And, It’s not just individual investors who could be affected – but also super funds and international ETFs too.