Meketa Investment Group examines “right-tail” investing, where a small minority of companies drives most long-run wealth creation. The paper argues investors are better served by broad exposure and letting winners compound than trying to select them, while private markets require deliberate diversification, access, and patience to capture similar asymmetry.
Investing for the Right Tail: Asymmetric Wealth Creation Across Public and Private Markets
Meketa
Frank Benham
13 Pages
Key Takeaways
Few stocks dominate: Roughly 2% of companies generated about 90% of aggregate net wealth, while six major winners added around $17 trillion.
Winners test patience: The six largest recent US wealth creators suffered an average 80% peak-to-trough decline, underscoring the difficulty of holding eventual winners.
Private dispersion widens: Venture capital’s average return was 23.5% versus a 14.9% median, while its 10-year interquartile spread reached 19.5%.
Join our newsletter to have all of this content + Exclusive Newsletter Bonus Content delivered to your inbox every week
