The term “Magnificent Seven” was coined in 2023 by a Bank of America analyst to label the mega-cap tech stocks of Apple, Alphabet (Google), Amazon.com, Meta Platforms (formerly Facebook), Microsoft, NVIDIA Corp., and Tesla. These stocks account for up to 40% of the market capitalization of major indexes, and they largely drove the 2023-2025 bull market.
However, these seven were not immune to the 2025 bear market, and were down 24% on average for the year by the time the bear market bottomed in April. These are arguably the most important companies in the world, and are stocks every investor should own. For the 2025 first quarter, earnings from the seven grew year-over-year by 27.7%, which is triple the growth of the other 493 stocks in the S&P 500.
Keep in mind, these are not inexpensive stocks, with share prices in the $100s. To buy just one share of each of the seven would cost over $2,200.
Enter the Roundhill’s Magnificent Seven ETF (MAGS). The folks at Roundhill quickly jumped on the Magnificent Seven bandwagon, launching MAGS in April 2023. The ETF provides equal-weighted exposure to the seven stocks, with quarterly rebalancing. Here are the current weightings:
On April 23, Roundhill Investments provided investors with another Mag Seven option, launching the Roundhill Magnificent Seven Covered Call ETF (MAGY). With MAGY, the fund managers employ a covered call strategy using MAGS as the underlying asset. MAGY paid its first monthly dividend in May, and the fund has a current distribution yield of 25.57%.
I think it’s pretty clever to offer investors two options for gaining investment exposure to these stocks. So, how do you want your Magnificent Seven? With or without dividend sauce?
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