12.11.14: SP 500: Earnings Weight vs Market Cap Weight in Index

Had to throw this spreadsheet up FC – marketcapvsearningswt (click on the link) to show readers the difference between a sector’s earnings weight, versus the same sector’s market cap weight.

The Energy sector’s earnings weight at present is a little over 11% versus Energy’s current market cap weight of 8%, which explains our recent headlines in the SP 500 Weekly Earnings Update, that state that we think Energy’s negative revisions are masking decent growth elsewhere in the SP 500.

Financials are the same as Energy too. The Financial sector earnings weight is heavier than Financials market cap weight, just not to the same degree.

The Energy sector has the biggest difference between the two weightings within the SP 500, although Financials are a close second.

Hopefully readers find this info insightful.

Thanks to Greg Harrison of Thomson Reuters for his prompt response to the question.

Trinity Asset Management, Inc. by:

Brian Gilmartin, CFA

Portfolio manager


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