28. $AAPL Stock Impacts & Tools to Compare ETFs ($VOO vs $VTI)

Mar 8, 2024

Dive into the intriguing world of $AAPL stock and why it's down while the S&P 500 rises. Discover the significance of market capitalization and the challenges Apple faces in a competitive landscape. Learn how to effectively compare ETFs like $VOO and $VTI using a handy tool, examining their composition, performance, and risk metrics. The hosts break down dividends and investor objectives, helping you decide which fund might align best with your goals. Tune in for valuable insights and market analysis!

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INSIGHT

Market Cap Drives Index Movement

The S&P 500 is market-cap weighted so the largest companies move the index the most.
Market cap equals shares outstanding multiplied by share price, which changes constantly.

INSIGHT

Big Stocks Don't Always Move The Market

A big stock like Apple can fall while the S&P 500 rises because other large names outperform.
The index's breadth or concentration determines how single-stock moves affect overall returns.

ANECDOTE

Pop Star Analogy For Company Dominance

Jess compares Apple and Microsoft using pop stars to illustrate dominance in the index.
She says Microsoft 'stole the pie' and refers to Apple's innovation cycle and WWDC anticipation.

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Let's talk about what's going on with the $AAPL stock and also learn how to compare ETFs, like $VTI vs $VOO, with a tool! You'll want to watch the video about 10 minutes in, but if you can't watch it, we do describe everything we're analyzing.

$AAPL Stock Is Down, But The Market Is Up?

We know that Apple is one of the biggest stocks or companies in the S&P 500, which is the index we use to measure the stock market (check out episode 2), so then how is $AAPL down 8% and the S&P 500 is up 8% year to date (March 7, 2024)?

Jargon Breakdown:

Here's a refresher on Market Capitalization
Magnificent 7 = Alphabet (NASDAQ: GOOG; GOOGL), Amazon, Apple, Meta Platforms, Microsoft, Nvidia, and Tesla
Indices/Index: The big 3 (S&P 500, NASDAQ, Dow Jones) are how we measure the stock market, but we mainly look at S&P 500 to see how the market is doing
ETF = exchange traded fund (we have an episode on ETFs and Mutual Funds if you want a refresher).
Fiscal Policy - the government using taxation and spending to influence the economy. We also talk about the CHIPS Act in regard to how fiscal policy can affect stock price.

How to Compare ETFs or Other Securities

Let's say you want to compare 2 different ETFs that you're interested in investing, which have similarities. We'll compare $VTI and $VOO ETFs using Merrill's Fund Story. You do have to have a Merrill

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