The major US tech companies belong in the portfolio – but with a sense of proportion

Had investors not held these stocks, their portfolios would have suffered significant performance losses. One consequence of this development is that the global stock market will be dominated by American technology companies in 2025. Back in 2005, the share of the ten largest stocks in the global stock market was 9.3% – by 2025, it will be almost 30%. Nvidia's market capitalization is nearly twice that of all 40 DAX companies combined. North America's weight in global stock market capitalization has increased noticeably since the 1990s: from 32% in 1988 to 75% in 2025. This has created a considerable concentration risk, which, should the high expectations for these tech companies not be met, would lead to significant share price declines.

Investors are thus faced with a dilemma: Should they follow the high weighting of US tech stocks, because these have been the main drivers of returns and profits over the last ten years? Or should they underweight these stocks to reduce concentration risks?

Despite the initial euphoria, it remains to be seen whether the currently very high market expectations for tech companies will materialize and whether this trend can be extrapolated into the future. Artificial intelligence (AI) will undoubtedly continue to grow in importance. However, it remains to be seen whether the enormous investments in data centers and IT infrastructure will be able to generate the necessary profits in the coming years to make them worthwhile. Current AI spending already exceeds that at the height of the dot-com boom as a percentage of GDP. Furthermore, high margins in the AI ​​sector are attracting new competitors and disruptors like DeepSeek.

Recognizing trends is crucial for long-term investment success. But as the American writer Mark Twain already knew: "Predictions are difficult, especially about the future." In 1993, Bill Gates, founder of Microsoft, said the internet was just a fad. And Elon Musk, founder of Tesla, still believed in 2013 that we would be driving 90% autonomously within three years.

Our key takeaway is therefore this: No one can currently make a reliable assessment of how quickly AI developments will progress and whether we are in an AI bubble on the stock market. Therefore, the major US technology stocks naturally belong in our portfolio – but with a sense of proportion. Because despite all the advantages and opportunities, there are also arguments against an excessive concentration in these stocks, which is why we are currently moderately underweighting them.