A pretty inter­est­ing analy­sis in this story by Bloomberg.  As many know by now we've expe­ri­enced a 'lost decade' (actu­ally a bit longer now) in U.S. stocks as mea­sured by the most pop­u­lar of indexes, such as the S&P 500.  How­ever, that index is mar­ket weighted mean­ing the impact of an Exxon­Mo­bil (XOM) is far greater than the com­pa­nies in slots 490–500.  But, if you had equal weighted all 500 stocks, returns would have been solid, if not spec­tac­u­lar, at +66%.  Lead­ing to the ques­tion of why some­one has not cre­ated an equal weight S&P 500 ETF — reader says there is such a prod­uct — sym­bol: RSP.

Of course this makes sense from the aspect that over the long run, there are lim­its to growth prospec­tus — out­side of extreme exam­ples like Apple (AAPL), it sim­ply is harder to grow once you hit mas­sive scale.  Hence gains in small or mid caps "should" out­per­form large caps in the "very long run".  Spe­cific to the 00's, after a huge run in stock prices in the lat­ter 90s — espe­cially in the tech space — many large cap com­pany stocks have been espe­cially stag­nant as they gave back/digested the big moves a decade+ ago.

• Even with the Stan­dard & Poor’s 500 Index down 19 per­cent since the burst­ing of the tech­nol­ogy bub­ble in 2000, it’s been no lost decade for stocks.
• The bench­mark gauge for Amer­i­can com­mon equity climbed 66 per­cent from March 24, 2000, through Dec. 2, after strip­ping out adjust­ments for mar­ket value, which gives equal credit to Exxon Mobil Corp. (XOM), whose shares are worth $382.5 bil­lion, and Mon­ster World­wide Inc. (MWW), at $945.6 million.
• That’s lit­tle help for most investors, whose returns reflect the capitalization-weighted index, says Cliff Asness at AQR Cap­i­tal Man­age­ment LLC.   Gains in the equal-weighted index reflect appre­ci­a­tion in its smaller com­pa­nies and stocks with lower val­u­a­tions over the past decade, accord­ing to Asness, who helps over­see $38.8 bil­lion as founder and pres­i­dent of the AQR hedge fund in Green­wich, Connecticut.
• Gains in the S&P 500 Equal Weighted Index through the dot– com tum­ble, the Sept. 11 attacks, the real-estate col­lapse and the worst finan­cial cri­sis since the Great Depres­sion show the resilience of U.S. com­pa­nies that are fore­cast to report record earn­ings this year even as Europe’s debt cri­sis threat­ens growth again.
• “Cor­po­rate Amer­ica repaired itself,” Chris Hyzy, the New York-based chief invest­ment offi­cer at U.S. Trust Co., which over­sees about $360 bil­lion, said in a phone inter­view on Dec. 1. “On an equal-weighted basis, it hasn’t been a lost decade.”
• Own­ers of stocks in the S&P 100 suf­fered the most since March 24, 2000. The index fell 33 per­cent, dri­ven by declines of 70 per­cent or more in Cisco Sys­tems Inc. and Gen­eral Elec­tric Co., the sec­ond– and third-largest com­pa­nies behind Microsoft Corp. (MSFT) at the peak of the tech­nol­ogy bubble.
• Equi­ties suf­fered two bear mar­kets last­ing longer than a year in the pre­vi­ous decade. The first began after the S&P 500’s price-earnings ratio reached 31.2 fol­low­ing the 1990s rally led by com­puter and soft­ware mak­ers. The sec­ond started in 2007 as global bank losses from sub­prime mort­gages spi­raled toward $2 tril­lion. The gauge dou­bled in five years start­ing in Octo­ber 2002 as energy com­pa­nies ral­lied 242 per­cent as a group and raw– mate­r­ial pro­duc­ers jumped 162 percent.
• Energy pro­duc­ers climbed 149 per­cent in the past decade.
• Com­pa­nies in the S&P 500 are poised to report record earn­ings of $99.05 a share for 2011.
• Smaller com­pa­nies lifted the S&P 500 Equal Weighted Index to a record on May 10, almost four years after the capitalization-based gauge reached its all-time high of 1,565.15 in Octo­ber 2007.
• The Rus­sell 2000 Index (RTY), a gauge of small-cap shares with an aver­age mar­ket value of $667.8 mil­lion, peaked on April 29 and is up 28 per­cent since March 24, 2000. The rel­a­tive per­for­mance of smaller stocks doesn’t help the major­ity of investors. More than $5.58 tril­lion is bench­marked to the S&P 500 and about $1.31 tril­lion is directly linked to its value, accord­ing to an esti­mate by New York-based S&P.
• The biggest 100 com­pa­nies make up 63 per­cent of the value of the S&P 500 and almost half of the entire Amer­i­can market.

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