Magnificent 7 trade is broken — here’s where smart investors should look next
Complete. Here is the key summaryThe 'Magnificent 7' trade is losing momentum as the AI boom broadens beyond just seven stocks. While the Roundhill Magnificent Seven ETF (MAGS) surged initially, it has recently underperformed the S&P 500. Investors are shifting from a basket approach to selective investing, favoring companies like Alphabet, Amazon, and Meta that generate strong cash flow from AI integration, while viewing Apple and Tesla with more caution due to growth challenges.
Quick ReadThe MAGS ETF returned 158% since its April 2023 launch but has fallen 4% in 2026 while the S&P 500 gained 8%.Alphabet, Amazon, Meta, and Microsoft stand out for combining strong cash flows with AI monetization, while Tesla and Apple face steeper growth questions.Buying the Magnificent 7 as a single basket no longer makes sense, as each st...