Don’t Massive Investment Companies Included in Indexes Increase Leverage Within The Index?

So if you have for example Berkshire Hathaway holding apple shares, and apple shares go down, Berkshire goes down also and there's a ripple effect throughout the index. So some other Investment company might hold Berkshire and they also go down. Conversely if apple goes up then they also benefit and go up. Thereby doesn't having companies that hold other companies in the same index exacerbate and increase volatility in the index?