Institutional Investors Trim Mega-Cap Tech Holdings Despite Market Dominance
Mega-cap technology stocks, including Apple (AAPL), Microsoft (MSFT), Amazon (AMZN), Meta (META), Alphabet (GOOGL), and Nvidia (NVDA), are experiencing their lowest institutional ownership levels in over 16 years. Morgan Stanley's latest report reveals active fund managers hold these stocks at 140 basis points below benchmark weightings—a widening gap from Q1's 115-point deficit.
Nvidia exemplifies this trend. Despite commanding 7.37% of the S&P 500 and delivering a 1,346% five-year return fueled by AI GPU demand, institutional holdings average just 4.2%. The resulting 2.41-point underweight marks the largest disparity among tech giants. Year-to-date, NVDA's 30.8% surge dwarfs the S&P's 9.65% gain, highlighting the paradox of its under-ownership.
