(Reuters) - A year ago, Apple had its weight in the Nasdaq 100 cut in half after having grown to where it tipped the scales at more than one-fifth of the index.

The cut didn't last.

Apple, along with a few stocks that have surged in recent months, could soon represent nearly half the index, making this index of 100 well-known companies a hostage to the performance of a few technology titans.

The concentration of Apple, along with others, in the index's market cap-based weighting is exasperating for investors, who don't dispute that Apple should be the biggest weight but bemoan the size of its influence.

There should be some limitation on how much is held in a particular name, said Mark Bronzo, a money manager at the Irvington, New York-based Security Global Investors, which manages $22 billion.

Apple Inc (AAPL.O) was cut to 12.3 percent from 20.5 percent of the index in April 2011, but a surge in price has pushed it back up to 17.2 percent -- and the other big names have seen their share prices balloon as well.

A rebalance of the index will be triggered if Apple grows to more than 24 percent, or if the collective weight of all components over 4.5 percent exceeds 48 percent.

Along with Apple, the four names dominating the average are Google Inc (GOOG.O), Microsoft Corp (MSFT.O), Intel Corp (INTC.O) and Oracle Corp (ORCL.O). The growth of the top five companies increases the likelihood that the biggest names in the average will soon make up 48 percent of the Nasdaq 100 .NDX.

When you construct an index that is supposed to be a market benchmark, it shouldn't just represent a handful of names, said Bronzo.

Currently, Microsoft is the second-largest component, with a weighting of 9.4 percent, followed by Google (5.5 percent) Oracle (5.3 percent) and Intel (4.8 percent). At the rebalance, Microsoft's weighting was bumped to 8.3 percent from 3.4 percent, and it has grown since.

The five top names add up to 42.2 percent. That's up from 37.3 percent when the index was rebalanced, so their influence is growing but has not reached a point where a rebalance will occur.

No rebalancing is imminent, and if it happens, people will know about it weeks in advance, said John Jacobs, who runs the Nasdaq OMX Global Index Group in New York.

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For a graphic on the changing weightings of major components: link.reuters.com/ceg96s

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Apple's weighting was cut in 2011, as the Nasdaq felt it necessary to give more weight to other names that had shrunk in terms of their influence because of previous rebalancings.

Even with the other stocks taking a bigger part of the average, Apple is still the $500 billion gorilla. The outsized influence of the technology giant means that on days when the Nasdaq sees big swings, Apple is the primary driver.

How much does it matter? The stock's nearly 30 percent gains year-to-date are responsible for essentially all of the Nasdaq 100's 13.4 percent rise in 2012.

Apple has such a big weighting that it makes fundamentals less important for other names in the index, resulting in an environment where Dell Inc (DELL.O) can trade based on the number of iPads Apple sells, said Todd Schoenberger, managing director at LandColt Trading in Wilmington, Delaware.

If Apple stock falls, Schoenberger said, the whole tech sector is unfairly vulnerable.

This isn't to say the stock's influence on the index is completely out of whack. The Dow Jones Industrial Average .DJI is weighted by price, so International Business Machines (IBM.N), the third-largest stock in that average in terms of market value, accounts for nearly 12 percent of the index, more than six times the weight of Microsoft, which is a bigger company.

Nasdaq OMX Group (NDAQ.O), which operates the Nasdaq 100, can also rebalance if it is determined necessary to maintain the integrity of the index, a spokesman said.

Apple's return to a weighting near its previous one has come as its market cap has risen by about 58 percent since April 2011, when the rebalancing first occurred.

Paul Brigandi, vice president of trading at Direxion Funds in New York, said he would support a cut in Apple's weight for diversification purposes, as concentration in a few names is a concern.

Direxion operates a leveraged mutual fund that is tied to the Nasdaq 100 (DXQLX.O) and is down 2 percent this month.

Apple has a huge impact on the performance of the fund, and if it corrects that will impact total Nasdaq performance, Brigandi said. That's a valid concern, and not one we can do anything about.

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