Passive exposure to U.S. equity
48%
of average advisor portfolio
Portfolio Perspectives
PORTFOLIO PERSPECTIVES
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ADVISOR INSIGHTS
What we're seeing in actual advisor portfolios
Many advisor portfolios are highly concentrated in passive equity, which can result in unintended risk and missed opportunities to add value through active management.
Passive exposure to non-U.S. equity
29%
of average advisor portfolio
TAKEAWAY
Advisor exposure to heavily concentrated passive U.S. indexes may present portfolio risks.
TAKEAWAY
Advisors have continued to tiptoe into non-U.S. equity over the past year, but may be missing opportunities to add value from active management.
Source: Portfolio Consulting and Analytics team. The 48% statistic for passive U.S. equity allocations reflects the team's analysis of U.S. equity allocations in 2,560 portfolios from 1/1/26-6/30/26, including active and passive U.S. equity ETFs and open-ended mutual funds. The 29% statistic for passive non-U.S. equity allocations reflects the team's analysis of non-U.S. equity allocations in 2,380 portfolios for the same period, including active and passive ETFs and mutual funds.
ANALYTICS TOOLS & CONSULTING
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Analyze potential portfolio risks amid elevated levels of market concentration
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- Identify potential risks relative to portfolio objectives
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U.S. and emerging market stock indices have grown more top-heavy
The market indexes are unmanaged and, therefore, have no expenses. Investors cannot invest directly in an index.
Sources: Capital Group, FactSet, MSCI, S&P Global. Figures represent the index concentration of the top 10 companies by market capitalization across the S&P 500 Index (U.S.), the MSCI Europe Index (Europe), the MSCI World ex USA Index (Developed non-U.S.) and the MSCI EM Index (Emerging markets). Data shown is monthly, from January 30, 1998, through May 31, 2026.
CIO Martin Romo on market concentration:
Why rising market concentration in the age of Al strengthens the case for active management.
Hear from our clients
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Capital Group's Portfolio Consulting and Analytics team meets with thousands of advisors a year. Our consultants can partner with you to analyze risks and opportunities in your portfolios.
Portfolio Consulting and Analytics team
13
Average years of experience
22
Dedicated portfolio consultants
Nearly
11,500
portfolio engagements for the first half of 2026
Source: Capital Group. Portfolio Consulting and Analytics team data as of December 31, 2025.
MODEL PORTFOLIOS
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We offer a range of models to meet client needs, including active ETFs, active-passive and tax-aware models.
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Investing outside the United States involves risks, such as currency fluctuations, periods of illiquidity and price volatility. These risks may be heightened in connection with investments in developing countries.
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