Investors who focus solely on the S&P 500 may be missing out on significant returns from other large stocks. A recent analysis by Investor’s Business Daily found that eight companies outside of the S&P 500, including Dell Technologies, The Trade Desk, and Apollo Global Management, have outperformed the index by an average of over 40% this year. These companies, which all have market values of at least $30 billion and have posted profits in the past 12 months, are considered large and profitable. Their success highlights the potential gains that can be achieved from investing outside of the S&P 500.
One notable example is Dell Technologies, a global technology leader with a market value of $50 billion. Despite not being included in the S&P 500, Dell’s shares have surged over 74% this year, significantly outperforming the index. The company has also remained profitable, earning over $1.9 billion in net income in the past year. Another example is The Trade Desk, a well-regarded manager of online advertising that is expected to eventually join the S&P 500. Its shares have risen more than 67% in 2023, while it generated $129 million in net income in the past year. Additionally, companies in the financial sector, such as Apollo Global Management and KKR, have seen strong gains outside of the S&P 500 due to investors’ optimism about new investment opportunities.
While the S&P 500 captures most large U.S. stocks, some high-performing companies still fall through the cracks. The omission of these companies from the index can have a significant impact on investors’ portfolios. Therefore, diversifying beyond the S&P 500 and considering companies like Dell Technologies, The Trade Desk, and others can potentially lead to higher returns and capture opportunities that are not available within the index.
