With a market cap just over $730 billion, Apple (NASDAQ:AAPL) is the largest company in corporate history.

It's also the largest component of the S&P 500 by a fairly sizable margin. Apple makes up around 4% of the stock index -- and its recent surge has been a significant contributor to the index's rally.

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S&P 500 vs. Apple Total Return, data by YCharts

But on a historical basis, other firms have been more significant. Apple's once fierce foe IBM (NYSE:IBM) dominated the S&P 500 in the mid-1980s, accounting for (at one point) as much as 6% of the index.

But shortly thereafter, IBM's business collapsed, and the company was forced to reinvent itself. What happened, and should Apple shareholders be concerned?

Exterior of Apple Store in Milan, Italy.

Image source: Apple.

Apple's 1984 ad
Apple's iconic 1984 Super Bowl ad serves as a key symbol of IBM's power in the mid-1980s. For roughly three decades, IBM had been the dominant supplier of computer technology to corporate buyers. IBM was so dominant, in fact, that the Justice Department pursued the company for a dozen years on antitrust grounds before ultimately dropping the case in 1981.

Throughout the 1960s and 1970s, businesses were addicted to IBM's high-margin mainframes. The nascent personal computer revolution threatened to topple IBM's dominance, but the company appeared to be setting itself up to commandeer that market as well.

Apple's 1984 ad for the then upcoming Macintosh appeared to take a shot at IBM, likening the company to the nefarious Big Brother from George Orwell's literary masterpiece.

The PC revolution brings IBM to its knees
The ad proved prophetic. Although the Macintosh itself didn't bring down IBM, the machine was ultimately successful in igniting the personal computing revolution -- a revolution that undermined IBM's power and sapped it of its profits.

IBM's earnings began to slide in 1985. It blamed a variety of factors, including a sluggish economy, but within a few years it became obvious -- personal computers were taking a toll on the demand for its mainframes, and the company had no answer.

Profits became losses in the early 1990s, and in 1992, IBM reported what was then the largest annual loss in American corporate history: $4.96 billion. From 1987 to 1993, IBM's stock -- which had long been considered the very definition of a blue chip -- shed more than half of its value.

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S&P 500 vs. IBM Performance, data by YCharts

In the long-run, IBM was able to recover, reinventing itself by ditching hardware and embracing software and services. But any investor who bought IBM in early 1986 lost money over the next few years, and has underperformed the S&P 500 to this day.

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S&P 500 vs. IBM Total Return, data by YCharts

Should Apple shareholders be concerned?
The IBM of the 1980s and Apple today do share some modest similarities. Other than the fact that they're both technology companies, both firms managed to generate record earnings on the back of high-margin, highly integrated hardware.

But that's where the differences end. IBM was primarily selling to businesses, and its own products were eventually upended by cheaper, better alternatives. Apple sells its gadgets mostly to consumers, and has yet to face significant low-cost rivals, although cheaper Android handsets from China could eventually pose a significant risk.

It may be more of a technical argument than a fundamental one, but DoubleLine's Jeff Gundlach (via Business Insider) pointed out last month that owning the largest component of the S&P 500 has never been a wise investment. Whether it's IBM or ExxonMobil, since 1972, the largest member of the S&P 500 has consistently under-performed the rest of the index on a total return basis.

Apple could be the first company to defy that trend, but it's something shareholders should definitely keep in mind.

This article represents the opinion of the writer, who may disagree with the “official” recommendation position of a Motley Fool premium advisory service. We’re motley! Questioning an investing thesis -- even one of our own -- helps us all think critically about investing and make decisions that help us become smarter, happier, and richer.