Magnificent 7 Stocks: What are the Magnificent 7 Stocks?

In 1960, John Sturges released the Western classic Magnificent Seven, which featured the likes of Charles Bronson and Steve McQueen in the cast.

Six decades later, there is another Magnificent 7 group making waves, but in the stock market.

Apple, Amazon, Alphabet, Meta, Microsoft, Nvidia and Tesla are some of the biggest names in the tech industry. Unsurprisingly, these seven companies have also become staples for investors and traders.

In this article, we will go through the Magnificent 7 stocks, also known as the Super 7 stocks, how they came to be, and why this group of companies is considered one of the strongest in the stock market, while also looking at their pros and cons. 

Ready to get started? Let’s dive in. 

Magnificent 7 Stocks: Introduction 

The Magnificent 7 started as a four-company group, known as FANG.

The acronym, which was coined by popular Mad Money host Jim Cramer, stands for Facebook (Meta), Amazon, Netflix, and Google (Alphabet).

FANG stocks soon became extremely popular investment options.

The four tech stock juggernauts experienced enormous growth in a relatively short period, establishing themselves as some of the best-performing stocks. 

But as the tech industry continued to expand, the FANG stocks weren’t the only ones drawing attention from investors and traders.

Apple, Microsoft, Nvidia, and Tesla soon joined the group at Netflix’s expense, taking the number to seven major names. FANG then became the Magnificent 7, named after the famous 1960 movie. 

Magnificent 7 stocks have regularly outperformed other big names, including fellow S&P 500 companies.

As a result, these seven tech giants have become a very popular investment - which, in turn, has also driven their stocks’ prices up. 

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What are the Magnificent 7 Stocks? 

As mentioned above, the Magnificent 7 stocks are among the biggest companies in the US stock market.

The group consists of Alphabet (Google’s parent company), Amazon, Apple, Microsoft, Meta (Facebook’s parent company), Nvidia, and Tesla. 

While all seven companies are part of the tech industry, they all operate in different segments - from computer hardware and video games to artificial intelligence and electric vehicles.

There is one thing in common among them: these are all major technology trends, which bodes well for the Magnificent 7 companies’ future and explains their growth in recent years. 

Let’s take a brief look at each one of the Magnificent 7 companies. 

1. Alphabet Inc. (GOOG) 

• Alphabet was established by Google in 2015.
• Aside from its flagship search engine (including the products under Google’s umbrella, like Android and YouTube), Alphabet’s list of subsidiaries also includes Calico, CapitalG, Google Fiber, GV Management, Isomorphic Labs, Verily, Waymon, Wing, and X Development.
• Alphabet is present in multiple segments, including healthcare, autonomous vehicles, and investments. 

You can trade GOOG CFDs in both price directions, or invest directly in GOOG shares directly.

2. Amazon.com Inc. (AMZN) 

• Having started as an e-commerce website, Amazon has since expanded to multiple segments.
• Its flagship e-commerce platform also has several other brands under its umbrella: Alexa, Appstore, Luna, Music, Pay, and Prime. Amazon also owns MGM+, Twitch, and Ring, while having also developed the popular e-reader Kindle and the Android-based OS Fire.
• Amazon has also firmly established itself as one of the biggest names in the online streaming segment. 

You can trade AMZN CFDs in both price directions, or invest directly in AMZN shares directly.

3. Apple Inc. (AAPL) 

• Apple is the world’s largest company by market capitalization.
• The California-based tech juggernaut is well-known for its flagship products, iPhone, iPad, and Mac.
• Additionally, Apple has also expanded its portfolio to include multiple online services: App Store, Apple Card, AppleOne, Apple Music, Apple Pay, and Apple TV+. 

You can trade AAPL CFDs in both price directions, or invest directly in AAPL shares directly.

4. Meta Platforms Inc. (META) - Formerly Facebook (FB)

• Following a rebranding, Facebook Inc. changed its name to Meta in 2021, in reference to the metaverse.
• Aside from its major social media platform, Meta also incorporates other products owned by Facebook, a list that includes Instagram and Threads, WhatsApp, and Meta Quest (the VR device formerly known as Oculus). 

You can trade META CFDs in both price directions, or invest directly in META shares directly.

5. Microsoft Corp. (MSFT) 

• Well-known for Windows, the world’s most popular operating system, Microsoft has always been among the most valuable companies by market cap.
• The tech giant’s portfolio includes software and hardware development, social media platforms, and video games.
• Microsoft’s list of brands is an extensive one and goes well beyond Windows.
• In recent years, Microsoft has also established close ties with OpenAI, positioning itself well in another key tech market. 

You can trade MSFT CFDs in both price directions, or invest directly in MSFT shares directly.

6. Nvidia Corp. (NVDA) 

• For a long time, Nvidia was known almost exclusively for its graphic processing units (GPUs), commonly known as video cards.
• But, aside from its high-performance computer and smartphone components, Nvidia is also one of the top names in the AI segment.
• CUDA, which stands for Compute Unified Device Architecture, is Nvidia’s proprietary, closed-source platform for machine learning, and is widely regarded as one of the driving forces behind the AI boom. 

You can trade NVDA CFDs in both price directions, or invest directly in NVDA shares directly.

7. Tesla Motors Inc. (TSLA) 

• The American electric vehicle manufacturer was one of the first to venture into the market, and, as such, has established itself as the leader in the EV segment.
• Tesla offers a wide range of models, which includes luxury sedans (Model S), SUVs (Models X and Y), sports cars (Roadster), pickup trucks (Cybertruck), and semi-trucks (Tesla Semi).
• In 2015, Tesla expanded into the clean energy segment with its subsidiary, Tesla Energy Operations. 

You can trade TSLA CFDs in both price directions, or invest directly in TSLA shares directly.

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Magnificent 7 Stocks: Advantages and Disadvantages 

Just like any other investment, Magnificent 7 stocks have pros and cons. We will now look at some of the advantages and disadvantages of Magnificent 7 stocks. 

Magnificent 7 Stocks: Advantages 

• The Magnificent 7 usually do their name justice. In 2023, for example, the group of companies averaged a 71% return according to Goldman Sachs. 
• Magnificent 7 stocks have been trending up in recent years, and there is reason to believe that they could likely continue to do so. These companies are all household names and major brands in key tech segments, such as AI, electric vehicles, online payments, e-commerce, and streaming, which will likely keep growing over the next few years. 
• As mentioned above, the Magnificent 7 are all well-known global brands, with a firm hold on their respective segments. These companies will likely continue to dominate the market in the long run. 

Magnificent 7 Stocks: Disadvantages 

• As you would imagine, Magnificent 7 stocks are high-priced stocks. Due to this, these stocks can drive away a few investors. 
• Magnificent 7 stocks have enjoyed incredible growth in recent years, but the current won’t be sustainable in the long run. While these stocks can continue to perform well, it’s extremely unrealistic to expect a three - or even four-digit rate - every year. 
• Magnificent 7 stocks can be considered cyclical stocks. These companies may put up good numbers during periods of economic growth, but will likely struggle once the economy slows down. 

How to Invest in the Magnificent 7 Stocks 

A reliable and certified broker, like Admirals, is one optional way to invest in Magnificent 7 stocks. At Admirals, you can trade and invest with the MetaTrader 5 platform.

The best multi-asset platform available, MT5 allows you to either invest or trade Forex, CFDs, stocks, ETFs, futures, and many other products. 

MetaTrader 5 includes many useful tools and features, such as graphics, personalized charts, financial news, educational tools, and AI automated trading.

You can invest in Magnificent 7 stocks with an Invest.MT5 account, or trade with a Trade.MT5 account instead. 

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Magnificent 7 Stocks: Conclusion 

Magnificent 7 stocks are among the best-performing investments and include some of the biggest companies in the US.

Naturally, this makes the Magnificent 7 a potentially interesting option for your portfolio. Over the past few years, Magnificent 7 stocks have significantly outperformed other stocks, delivering returns in the three and four-digit range.

However, keep in mind that these stocks trade for a high price, which can drive investors away. 

Additionally, this growth rate may not be sustainable in the long run and these numbers may drop slightly at some point in the future.

Overall, just like any other investment, Magnificent 7 stocks come with pros and cons, so it’s up to you to weigh the advantages and disadvantages before deciding whether to add them to your portfolio. 

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