I guess the story here is more like

If you take the Top 500 companies as an indicator how well your economy is doing, but everything is carried on the shoulders of only 1.4% of those 500 companies then what is the point of looking at the 500 companies in the first place.

Make an S&P10 then instead. or in addition to the S&P500

That would probably be a good way to look at it anyway. Looking at the trend of the S&P10 vs. S&P500 and if they agree then thumbs up, but if they disagree then things might not be as rosy as everyone thinks

The problem with that approach is you miss out on the gains of tracking a company from when its market cap is small to when it is large, and only capture the opposite as it leaves the top 10.

This is one reason people are so concerned with companies going public later. If they just appear in their fully formed embodiments then you can only capture their growth after they are large and their death.