The S&P 500 owes more than all of its success this year to eight stocks, known by the acronyms Fang and Nosh:
- Facebook (+31% year-to-date)
- Amazon (+110% YTD)
- Netflix (+122% YTD)
- Google (+41% YTD)
- Nike (+35% YTD)
- O'Reilly (+41% YTD)
- Starbucks (+50% YTD)
- Home Depot (+18% YTD)
Collectively, these eight stocks account for a roughly 2.5% positive contribution to the S&P 500's return this year.
The index is up about 0.6% over the same time period, so these stocks actually account for more than all of the gains the benchmark index has enjoyed this year.
If you take half a second to think about why these stocks, what you find are corporate representations of the major themes that are playing out in the US economy.
Consumer spending is solid (Amazon, Netflix, Nike, and Starbucks benefit here), the housing market is showing real signs of strength (Home Depot is a winner here), auto sales are soaring (O'Reilly is winning there), and online advertising money is going to two places: Google and Facebook.
So on the one hand, great job by these eight companies dominating their industries. On the other hand, are there no other good ideas out there?
Goldman Sachs