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Should you chase the stocks of market giants? the "Magnificent seven" vs. "Today’s TOP"
These days, many investors are drawn to well-known, high-profile companies like Apple, Tesla, and Nvidia. These giants, part of the S&P 500’s “Magnificent Seven,” enjoy enormous market trust. But does all the potential for returns really lie with these leaders alone?
Our "Today’s TOP" section presents stocks that can not only deliver greater returns but also offer broader diversification and a more accessible entry point for investors.
Comparing returns (November 13, 2024 – December 13, 2024)
The «Magnificent Seven» (S&P 500)
- Apple (AAPL): +10.22%
- Tesla (TSLA): +32.09%
- Nvidia (NVDA): -8.22%
- Meta (META): +6.96%
- Amazon (AMZN): +6.24%
- Alphabet (GOOG): +6.12%
- Microsoft (MSFT): +5.19%
- Total Return: +9.70% 📈
Top 7 Stocks in PredictStock’s “Today’s TOP”
- ATAT: +1.35%
- QFIN: +27.96%
- UAL: +5.94%
- TSM: +7.68%
- KGC: +5.17%
- UTI: +26.76%
- KINS: +33.95%
- Total Return: +10.26% 🚀
Our selected group of 7 stocks posted a +10.26% total return, outperforming the “Magnificent Seven” (+9.70%). Moreover, these gains are spread across several companies rather than being concentrated in just one or two high-profile names.
Three key points in our favor
1. Broader Diversification
The “Magnificent Seven” primarily consists of large tech corporations. This heavily exposes your portfolio to a single sector and its inherent risks. Our 7 picks span multiple industries: Insurance (KINS), Gold Mining (KGC), Education (UTI), Airlines (UAL), Alternative Energy (ATAT), Finance (QFIN), and Semiconductors (TSM). This mix lessens the impact of a downturn in any one area, making your portfolio more stable
2. Unearthing hidden gems
Stocks like KINS (+33.95%) and UTI (+26.76%) often fly under the radar of the general public. They may not be household names, but that’s exactly what can give them significant growth potential. You can buy them at more accessible prices and benefit if the market begins to recognize their undervaluation down the road.
3. Lower entry barrier and greater flexibility
The high prices of the “Magnificent Seven” can make diversification challenging for investors with a limited budget. Our 7-company portfolio costs roughly $1,000 total, allowing you to spread out your investments across various sectors and reduce risk.
Comparing $1,000 portfolios: “Magnificent Seven” vs. “Today’s TOP”
“Magnificent Seven” with $1,000
- MSFT: 1 share at $447.27
- AAPL: 1 share at $248.13
- GOOGL: 1 share at $189.82
- Remaining cash: ~$114.78 (not enough to buy another share)
As a result, you only hold three tech companies, meaning almost no diversification and a high dependence on a single sector.
“Today’s TOP” Portfolio with $1,000
- KINS (Insurance): 6 shares at $15.96 = $95.76
- KGC (Gold): 10 shares at $9.77 = $97.70
- UTI (Education): 5 shares at $25.77 = $128.85
- ATAT (Alt. Energy): 5 shares at $27.01 = $135.05
- QFIN (Finance): 3 shares at $38.85 = $116.55
- UAL (Airlines): 2 shares at $95.11 = $190.22
- TSM (Semiconductors): 1 share at $200.99 = $200.99
- Total: $965.12
Here, you get a portfolio spanning seven different sectors, so a setback in any one industry won’t cause your entire investment to plummet.
Why look beyond the “Magnificent Seven”?
Of course, the “Magnificent Seven” are market leaders. However, their large market caps mean high entry costs for investors and somewhat limited upside. Additionally, heavy tech concentration reduces diversification options.
Comparing just 7 of our “Today’s TOP” stocks to the “Magnificent Seven” already reveals an advantage. Now imagine you have not just 7, but a full 60–100 Strong Buy and Buy-rated stocks across diverse industries!
What “Today’s TOP” brings you
- Flexibility of choice: With a large selection (60–100 stocks), you can create portfolios tailored to any objective—from conservative to aggressive growth.
- Industry variety: Investing in several market sectors lowers your dependence on a single domain and curbs potential risks.
- Affordability and potential: For the same $1,000, you can acquire shares in a range of promising companies that have yet to reach peak popularity.
- Robust analytics: Strong Buy and Buy ratings show that the market sees solid fundamental growth potential in these stocks.
Don’t limit yourself to a few famous names with high barriers to entry. Build a portfolio that opens up more opportunities and enhances your chances of long-term success.
Try PredictStock now, with the first 7 days absolutely free!
Disclaimer: The materials are provided for informational purposes only and do not constitute investment advice. Before making financial decisions, consult a professional financial advisor.