Exchange Traded Funds (ETFs)

ETF Talk: A Magnificent Money Move

“There are three things we cry for in life: things that are lost, things that are found and things that are magnificent.”

–Douglas Coupland

Technology is here to stay, and investors have the opportunity to check off two out of the three things Douglas Coupland references with today’s ETF: Finding profits using the “Magnificent (Seven).”

I have always been one to appreciate the magnificence of life. Whether it be traveling abroad to go on an adventure, or appreciating my watch collection, I take the time to see the beauty in the life I have been given.

However, in the investing world, the word “Magnificent” holds a different weight. I am, of course, referring to the Magnificent Seven.

For those unfamiliar, the Magnificent Seven consists of a group of influential tech companies, all with a history of high performance. These companies include Amazon (NASDAQ: AAPL), Alphabet (NASDAQ: GOOGL), Apple (NASDAQ: AAPL), Meta Platforms (NASDAQ: META), Microsoft (NASDAQ: MSFT), NVIDIA (NASDAQ: NVDA) and Tesla (NASDAQ: TSLA).

I am no stranger to investing in technology, and it should come as no surprise that I have been keeping my eye on all these tech giants. Each of the seven stocks are in the Top 10 highest weighted stocks in the S&P 500, with Microsoft leading the pack.

This week’s exchange-traded fund (ETF), Roundhill Magnificent Seven ETF (MAGS), exposes investors to the companies that make up the Magnificent Seven, giving them a chance to have their hand in the profitable technology sector without having to pick a specific stock.

In the age of artificial intelligence and evolving innovations, investing in the technology sector has been at the forefront of many savvy investors’ minds, especially in today’s climate. MAGS is a little over two years old and is non-diversified. It has net assets of $2.34 billion and a one-year return rate of 25.19%.

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The top two holdings of MAGS are Tesla, Inc. (NASDAQ: TSLA) at 6.61%, and Microsoft Corporation (NASDAQ: MSFT) at 6.23%. The yield is 0.84%, and the expense ratio is 0.29%.

As shown in the chart, this ETF took a hit, right along with a lot of the market, due to the April 2 tariffs. But, in the last two months, it has rebounded, showing us just a little bit of why the Magnificent Seven got its namesake.

Despite the flattering title, it is still important to note that, like with any investing, ETFs still carry risk. Investors should always do their due diligence before adding any stock, fund or ETF to their portfolio.

As always, I am happy to answer any of your questions about ETFs, so do not hesitate to send me an email. You just may see your question answered in a future ETF Talk.

Jim Woods

Jim Woods is a 20-plus-year veteran of the markets with varied experience as a broker, hedge fund trader, financial writer, author and newsletter editor. Jim is the editor of Forecasts & Strategies, Tactical Trader, TNT Trader, Five Star Trader, Bullseye Stock Trader, and The Deep Woods. His books include co-authoring, “Billion Dollar Green: Profit from the Eco Revolution,” and “The Wealth Shield: How to Invest and Protect Your Money from Another Stock Market Crash, Financial Crisis or Global Economic Collapse.” He’s also ghostwritten many books and articles, as well as edited content for some of the investment industry’s biggest luminaries. His articles have appeared on many leading financial websites, including StockInvestor.com, InvestorPlace.com, Main Street Investor, MarketWatch, Street Authority, Human Events and many others. Jim formerly worked with Investor’s Business Daily founder William J. O’Neil, helping to author training courses in the CANSLIM stock-picking methodology. The independent firm TipRanks rates Jim the No. 3 financial blogger in the world (out of more than 6,000). TipRanks calculates that, since 2012, he's made 361 successful recommendations out of 499 total, earning a success rate of 72% and a +15.3% average return per recommendation. He is known in professional and personal circles as “The Renaissance Man,” because his expertise includes such varied fields as composing and performing music; Western horsemanship, combat marksmanship, martial arts, auto racing and bodybuilding. Jim holds a BA in philosophy from the University of California, Los Angeles, and is a former U.S. Army paratrooper. A self-described “radical for capitalism,” he celebrates the virtue of making money from his Southern California horse ranch.