S&P 500 top 10 now about 40%; investors look to EAFE

The top 10 stocks in the S&P 500 accounted for about 40% of the index as of May 31, 2026, up from roughly 18% on the same date in 2016. Index data show the concentration of weight in a small group of names has increased over the past decade.

A smaller number of mega-cap U.S. companies now drives a larger share of index returns and losses. For investors holding S&P 500 exposure, that concentration raises the extent to which overall performance is linked to a handful of stocks.

The MSCI EAFE Index, which tracks large- and mid-cap companies in developed markets outside the U.S. and Canada, is noticeably less top-heavy. In May 2026 the MSCI EAFE traded near a forward price-to-earnings multiple of about 16x, compared with roughly 22x for the S&P 500.

Advisors cite a valuation gap, sector weightings that have shifted toward technology and semiconductors, and improving earnings in parts of Europe and Asia as reasons some investors are adding developed international exposure.

VanEck’s VEFA fund seeks large and mid-cap companies listed outside the U.S. and Canada and tracks the MSCI EAFE Analyst Sentiment Select Index. That index uses an optimization process to increase exposure to stocks with positive analyst revisions while controlling for active risk, specific risk and beta relative to the parent EAFE index.

VEFA targets about 100 holdings, rebalances quarterly and aims to keep ex-ante tracking error below 4% versus MSCI EAFE. Because the index tilts holdings based on analyst revisions, the fund can diverge from a plain market-cap-weighted EAFE allocation.

Risks for international and active strategies include foreign-currency movements, geopolitical or country-specific events, sector concentration, liquidity constraints and the potential loss of principal. Past performance is not a guarantee of future results.

The S&P 500 is a market-cap-weighted index of 500 large U.S. stocks. The MSCI EAFE Index covers large and mid-cap equities across 21 developed markets in Europe, Japan and Australasia, excluding the U.S. and Canada.