
2Q24 TrailFP Newsletter and Market Review
In this post you will find information about market performance, some of our thoughts on the market and what to do moving forward, and some human side about the people of Trail FP.
The stock market had another positive quarter – up another 3% on top of the 10% gain from the first quarter. The gains continue to be driven by a handful of tech companies, the so-called “Magnificent 7:” NVIDIA, Microsoft, Amazon, Apple, Google, Facebook (Meta) and Tesla. Those seven companies have grown so much that they now represent over one-third of the entire value of the S&P 500. This fact is grabbing lots of media attention. Since the mid 1980s, the top 10 companies as a percent of the S&P 500 has ranged between 16 – 33% (see endnotes for reference). Thus, today’s concentrated value is high.
While today’s concentration is on the high side, the relevant question for investors should be, “what do we expect next?” Just like calling heads vs. tails, making a call on the future is easy to do, hard to do accurately. However, we can lean on some historical data to give us some context. The following graph illustrates how stocks that entered the “top ten list” performed before, and after, entering in the list.

The bars on the left show the average performance vs. the market of stocks in the 10-, 5- and 3-year periods before they entered the top 10 list. The bars on the right are the average 3-, 5- and 10-year performance after entering the top ten. It is not particularly surprising that before entering the top 10, those stocks out-performed the market (they grew into the top ten list). It may be surprising to note that the average performance after entering the top ten is similar to the market as a whole (without continue out-performance).
What should be done? We don’t believe in trying to out-predict the market. Thus, we wish to own shares in the Magnificent 7 according to the information contained by prices. Not more, and not less. We also wish to own the other available stocks and bonds around that world that are not currently having an out-sized impact on market returns. In other words, we intend to remain diversified. The only reliable way to know which stocks will be the best performers in the next few years will be to wait until those few years are done. Diversification helps to ensure that we own those investments, whichever they end up being.
Happy Summer everyone!
The rest of this message includes links to a written review of market performance and John’s audio tour of the report.
Detailed Market Performance – a watch
The following link is an under 2-minute narrated video of the other resources in this blog post. Some people prefer a guided tour over a read. But, the tour will be too fast to read!
The investment market performance report is prepared by Dimensional Fund Advisors (DFA), one of our partners in investment management and client support. If you would like to find out more about DFA, you can visit their website directly at: https://www.dimensional.com/
Detailed Market Performance – a read
To view a detailed analysis of investment performance in the US and global stock and bond markets, click on the button below.
What is Going on at Trail FP?
Welcome Casey – our new financial paraplanner

Trail FP is growing! In June, Casey Lederer joined Trail FP as our financial paraplanner. He will be supporting you, as well as Liz and John in our ongoing financial planning. You may start to receive communications from Casey with requests to share information, or reminders about upcoming meeting agendas.
Casey and his wife, Mady, moved to Bellingham after spending several years living in various spots around the country. Mady worked as a traveling Occupational Therapist and Casey worked while studying for his Certified Financial Planner (CFP®) exam. Casey passed the exam in March, and they moved out to Bellingham in June.
We are thrilled to have Casey join our team. He is smart, organized and fun. When asked what is his biggest take-away so far, he said, “I’ve been surprised at how much I’ve enjoyed meeting Trail FP clients.” Hooray, we feel the same way. We will send out a more formal introduction email to our clients towards the end of summer.
Trail FP in the news
John was quoted in a Washington Post story alongside a great story about a local Bellingham family! If you have a subscription to the Washington Post, check out the story, it’s a good one. If you aren’t a subscriber to the Washington Post, beware of clicking on this link, they have a very robust system of hooking you into becoming a subscriber! Click below to go to the Washington Post story
Disclosures and end notes
Information contained within is generalized information about investing and the investment markets. It should not be considered investment advice, personalized or otherwise. Past investment performance is not a guarantee of future investment performance. Investing in markets comes with an inherent risk of losing money.
End Notes
(1) Information on the performance of the S&P 500 over time can be found everywhere. Information about how inflation impacts those returns is little less common. I like to look at the excellent website maintained by Nobel prize winning economist Robert Shiller. Here is a link:
Mr. Shiller has no affiliation with Trail Financial Planning, and nothing that is presented in this blogpost or on the www.trailfp.com website has been reviewed, commented on or endorsed by Mr. Shiller.
(2) Is the S&P 500 too Concentrated? Goldman Sachs. March 21, 2024. Link:
(3) Link to Dimensional Fund Advisors one-page reference. “Think Twice About Chasing the Biggest Stocks.” Dimensional Funds Advisors, Feb. 2024.