Bloomberg Businessweek: "Bashing Big Tech now looks as dated as a handshake" (2020)

In a crisis, large companies can have an edge.  As the pandemic has forced the shuttering of local stores and restaurants, grounded consumers streamed Tiger King on Netflix, stocked up on groceries and supplies from Amazon, and gathered together on Zoom.  Hardly and company is immune from the economic shutdown, but the big ones have more resources to weather the pandemic and, in some cases, may be able to gain market share.

On Wall Street, that's exacerbating a divergence between small and large companies which has been frustrating stockpickers for some time.  The Russell 2000, a benchmark for small companies, has lagged the big-name S&P 500 index badly over the past two years.  This year the small stocks, with a median market valuation of about $525 million, have lost 22% as of April 28; the S&P, about half of that.  The Nasdaq 100, which tracks the largest tech stocks, is down less than 1%.  The S&P 500's companies now make up 82% of the entire U.S. stock market's value, a share that's been steadily rising this century.

None of that is good news for active fund managers...

[I]t's easy to see the pandemic continuing to entrench some advantages of size.  Bashing Big Tech now looks as dated as a handshake, and Silicon Valley's giants may be able to expand their clout. Large companies can also find it easier to tap credit and solve supply chain problems.

~ Bloomberg Businessweek, "How Quants Got Bullied," May 4, 2020