Batnick is responding to his CME guest's point that the top 10 names now make up more than half of the S&P 500. He updates a market-concentration stat he first posted in 2018.
…dicing and getting finer exposure to various asset classes, there's something else. So at CME, you guys are part of the revolution and you have introduced a new-ish category, single stock futures. What is the thinking behind this product? Who is it for? How do we access it? What's going on here?
…in the U.S. equity ecosystem, certainly that's continued to rise. And then the ability of those individual and institutional traders wanting all the capital efficiencies, the around-the-clock access, it really was the perfect opportunity to introduce single stock futures to the marketplace.
Tim, to what you've said, let me give you a stat that's going to blow your face right off your body. So Tim, speaking to the concentration in July of 2018, and at this point, the concentration had been building for years. It was not like a new concept. I think Jim Kramer created Fang in 2017. Apple crossed a billion dollars, a trillion dollars, excuse me, in 2018. So in July 2018, I tweeted that the top five stocks in the index are equal to the bottom, I think it was 240, 280, something like that. The bottom, the bottom 240 stocks in the SP 500. I recently updated that stat. The top five are now equal to the bottom 434 stocks. It is unbelievable the concentration that we're seeing in this market. And who knows how far it goes? I don't know where it stops, but it seems to be up and to the right.
Yeah, certainly. I think when you look at the prominence that the mega caps have had in the indices, and it's not just an SP Phenom, you see the same thing in the Nasdaq 100, you're seeing in the Russell 1000. It's just the, it's the byproduct of a market cap weighted index. And as these companies…
My idea of futures has always been very broad-based, right? The S ⁇ P and the NASDAQ essentially. That seems like what I would associate with CME Group. Just operationally, how different is it for individual names? Is it kind of like, well, no, it's the same process or maybe just a little more…
Yeah. So one of the good things about single stock futures, Ben, as you sort of note, it's another sort of widget on the trading machine at CME Group. It trades on our electronic platform called Globex. It's available through all of our normal distribution networks. So in a lot of ways, it's…