Ever notice how the top stocks are eating the whole market lunch these days? The S&P 500 is now more concentrated than the infamous Nifty Fifty period—and AI is the culprit.

Back in the '70s, the Nifty Fifty bubble was brutal. A handful of mega-cap stocks captured the market's imagination, and when they crashed, it was catastrophic. We're seeing echoes of that now, except it's AI-driven mega-caps like the Magnificent Seven pulling the strings.

Think about it: the top 10 holdings now account for a massive chunk of index returns. This concentration isn't just a trading quirk—it's reshaping how capital flows work. When these behemoths move, everything else follows or gets left behind.

For investors, this is a double-edged sword. Sure, betting on AI leaders has paid off big. But this setup is fragile. A rotation away from mega-cap tech could trigger serious volatility. The broader market rally is getting increasingly dependent on fewer and fewer names.

The irony? We built indices to diversify risk, but now the S&P 500 almost feels like a concentrated play on a single narrative. That's worth watching, especially if the AI boom starts to crack.