Investors are wary that US stock returns are over-concentrated in a handful of heavyweight tech stocks, and have poured a record amount of money into a fund that spreads its assets equally across the S&P 500, Financial Times reported.

Citing Morningstar data, the report said the Invesco S&P 500 Equal Weight exchange traded fund (ETF) logged US$14.4 billion in inflows in 2H24, as investors hedged their bets against the dominance of big techs.

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Even though the fund has underperformed the S&P 500 for years, total inflows into the ETF amounted to US$17 billion for the whole year 2024.

Analysts said investors are increasingly worried about the Magnificent Seven leading the market. The S&P 500 returned an aggregate 24% last year, with the seven stocks contributing half of the index's gain.

Manish Kabra, head of US equity strategy at Societe Generale, said investors have been most concerned recently about the risk of over-concentration. He expected double-digit earnings growth beyond the biggest techs in 2025.

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