Shrinking Equity Market?
Over the past couple of years, news headlines have
focused on the magnificent seven leadership of the
public equity markets and the concentration of the equity
indices. But if you look under the hood, you’ll find a
different market landscape with a smaller universe of
publicly listed companies.
The Public Equity Market
The Wilshire 5000 index was created in 1974 to
represent the investible U.S. market and was named
based on the number of constituents. In 1998, the index
hit its high in number of companies, over 7500, but since
that time, the number has fallen to around 3400 as of
December 2023. That’s over a 50% drop in the number
of companies since its high and a 30% drop since its
formation.