Why the MAGS ETF Hasn’t Gained Momentum This Year Despite Strong Performers like Alphabet and Apple

MAGS: The Big Apple’s Take on the Magnificent Seven

Hey folks, gather around while we take a good look at one of Wall Street’s latest conversations: the Roundhill Magnificent Seven ETF MAGS, dazzling us with a 45.17% return over the last year. But despite this bright showing, this year-to-date (YTD), it’s like MAGS hit a red light. Let’s dive in and see what’s clogging the gears.

Tesla’s Troubles: A Heavy Load

Now, when we talk tech titans, who can miss mentioning Tesla Inc. (TSLA)? I’m sure you’ve heard of their wheel troubles. Those EV guys are causing MAGS some serious headaches. Tesla’s looking a bit under the weather, ending a five-day slide at $328.50—ouch, that’s its lowest price since mid-November 2024. With its stock plummeting 10.53% YTD, Tesla’s the real Scrooge of the Magnificent Seven.

The problem child status comes after a 50% post-election surge turned cold fish, as investors zoom in on fundamentals—high valuations, delivery hiccups, and EV competitors all jammed up Tesla’s parade.

Nvidia and Meta: A Tale of Two Stocks

Speaking of roller coasters, ever seen Nvidia Corp. (NVDA) in action? It’s usually the darling for buyers during dips, but a sharp selloff sent the chip giant reeling. Word from Chinese AI startup DeepSeek led to a 17% drop one tragic day, snipping roughly $590 billion in market value. Though NVDA’s regaining some ground, the specter of faltering AI investments lingers with a 4.85% dip YTD.

On the flip side, Meta Platforms Inc. (META) has been dazzling the crowds with the illustrious glow of success. With solid ad revenue, cost maneuvers, and a strong AI drive, Meta’s painting a pretty 20.85% gain for early 2025—a nice counterbalance to others dragging their feet in MAGS.

Apple and Alphabet’s Rough Seas

It’s not all roses and daffodils, folks. Apple Inc. (AAPL) isn’t jiving so well. Navigating a downturn in Chinese demand and some feisty EU regulations, Apple’s stock has slumped 3.51% YTD. It seems like Alphabet Inc. (GOOGL) is wrestling a similar bear, with fresh competition in AI and ad revenue jitters subtly tipping them close to a 3% decline.

The Curse and Blessing of Equal Weights

So, what gives, right? Shouldn’t MAGS be riding high? Here’s the twist: unlike the S&P 500 or Nasdaq, MAGS goes for an equal-weight shuffle. Each of the seven stocks carries roughly the same load of the fund’s weight. It helps keep any one stock from being the boss, but you know what? It also slows the whole shebang when big guns are in the mud.

While MAGS squeaked ahead of the broader Nasdaq in the past year, its equal-weight artistry is a double-edged sword for YTD. With Tesla and Nvidia tugging down, even a giant like Meta’s not enough to break things skyward.

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