The three-month intra-stock correlation in the S&P 500 has dropped to zero, its lowest level since 1990, according to Truist Wealth. This historic situation indicates that stocks in the index are moving independently of one another, with dispersion particularly pronounced in technology and consumer discretionary. The equal-weighted S&P 500 has outperformed the cap-weighted index this year, while value stocks have outperformed growth stocks and small caps have outperformed large caps. The current environment favors active investing over passive indexing, allowing investors who do thorough homework on individual stocks to truly make a difference.
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