01Core Indexes: Modified QQQ

I’ve had a lot of requests for additional information on the modified QQQ and the modified S&P 500 indexes. In order to make it easy to track the performance I’ve opened up a new brokerage account where I will allocate funds to the indexes - anyone can follow along. If you want - you can open up an Interactive Brokers account and use their “model portfolio” tool - this allows you to automatically treat the entire thing like an ETF and put in $500 or whatever amount and then have it auto-allocate using fractional shares - as opposed to having to purchase fractional shares in each stock individually. Below is the starting portfolio along with some statistics.

• 26EC means consensus earnings estimates for 2026

• 26ET means trough earnings estimate for 2026

• FPEC means forward PE based on consensus

• FPET means forward PE based on trough

• FPECW means the weighted impact on a look through basis of the consensus PE

• FPETW means the weighted impact on a look through basis of the trough PE

• 25EPS = current consensus estimates for 2025

• ImpGR = implied growth rate based on consensus estimates from 25 to 26

• Weighted growth rate is the growth rate multiplied by portfolio weighting

Total result is a portfolio trading at 22.32X 2026 consensus earnings and 27.45X trough 2026 earnings. Fwiw, both of these figures are CERTAIN to be lower than in reality if the tariffs remain in place in anything remotely similar to their current form. Still - as a basket the portfolio does not look expensive relative to the growth prospects (18% EPS growth based on consensus expectations).

This truly is one of the most beautiful portfolios that has ever existed. It is basically a conglomeration of the most attractive companies on Earth - which happen to almost all be operating in what I refer to as synthetic monopolies. I wrote a post about what a synthetic monopoly is here:

I’ve also explained why Big Tech is the best way to play the continued proliferation of AI due to it being a synthetic monopoly here:

If you considered the entirety of this index as a single business with each of the companies representing divisions, then we would have the following market shares:

1. Digital advertising: 66.4%

2. Computer operating systems: 91.1%

3. Mobile operating systems: 99.7%

4. Cyber Security: 17.4%

5. Logic Chip Design: 100%

6. Semiconductor capital equipment: 81.8%

7. Cloud Computing: 67.5%

8. Ecommerce: 43.3% (US)

9. Productivity Software (Office 365, etc): 87.2%

Some of the figures above like Cloud Computing are understated. There are really only 3 clouds in the sense that most people think of them - Azure, GCP, and AWS - only these companies are capable of acting as a “Base-Layer” (term I described in my post on The Cloud. So an alternative market share is 100% if we restrict “Cloud” to mean “Base-Layer”.

Similarly, if you were to use profit instead of revenue to calculate market share in digital advertising then the market share of this portfolio would be on the order of 86-87%.

Not only are the market shares above disgusting, they are disgusting in the most attractive business models that humans have ever created - with the largest and still expanding TAMs, with incredible secular tailwinds, and unparalleled optionality for the coming world of AI.

I’ve just wired the funds so hopefully they arrive today and I can get this started and post the beginning screen shot. Pretty wild time to be starting, should be exciting!

Obviously, this will be benchmarked against the QQQ.