What If You Invested In S&P 500 Excluding Mag 7? Here's How NVDA, AMZN, AAPL And Others Have Performed In The Last Year

The S&P 500 index growth sans the Magnificent 7 stocks is almost negligible over the last 10 years, as the market capitalization of these stocks dominates the index.

What Happened: According to a Goldman Sachs graph shared by the Markets & Mayhem, the Magnificent 7 stocks have driven the S&P 500 growth since 2014, with their index rising from 500 to over 3500.

While the remaining 493 stocks stagnated near 500, reflecting a 2024 study by Goldman Sachs showing the stocks accounted for over 30% of the S&P 500’s market cap.

This concentration aligns with the Pareto principle, where 20% of assets drive 80% of returns, supported by a 2018 ScienceDirect study on stock market indices that found power-law distributions in extreme variations, suggesting the Magnificent 7’s dominance is a natural outcome of market-cap weighting rather than an anomaly.

Thus, according to this graph, if an investor invested in the S&P 500, excluding the Magnificent 7 stocks, they’d have virtually negligible returns.

Filip Felician Dames, the founder of a venture capital fund, Cherry Ventures, explained that the research and development, or R&D spending, by Magnificent 7 stocks was a significant determinant of the company’s “future earnings power.”

“We need more innovation and risk-taking mentality,” he added.

Meanwhile, looking at the valuation of these seven firms using the price-to-sales ratio, Amazon.com Inc. was the cheapest at 0.38, while Microsoft Corp. was the most expensive at 0.92.

See Also: Dan Ives Says Market Is ‘Massively Underestimating’ This AI Play, Urges Investors To Look Beyond Mag 7

Why It Matters: Comparatively, the Magnificent 7 stocks haven’t performed well in 2025. Only Nvidia Corp., Microsoft, and Meta Platforms Inc. beat the -1.33% year-to-date return of the Roundhill Magnificent Seven ETF (BATS:MAGS) and the 1.91% return of the S&P 500 index.

According to Benzinga Pro, the SPDR S&P 500 ETF Trust (NYSE:SPY) was trading above its short and long-term simple dialing moving averages with a relative strength index at 57.35, which was in a neutral zone.

Despite the largely bullish chart, its momentum indicator was reflecting a key bearish crossover signal as its MACD line of 7.1 was below the signal line of 8.3 with a negative histogram value of 1.2.

Price Action: The SPY and Invesco QQQ Trust ETF (NASDAQ:QQQ), which track the S&P 500 index and Nasdaq 100 index, respectively, declined slightly on Wednesday. The SPY was down 0.015% at $597.44, while the QQQ was 0.017% lower at $528.99, according to Benzinga Pro data.

On Friday, the futures of the S&P 500, Dow Jones, and the Nasdaq 100 indices were trading lower.

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Photo courtesy: Jack Hong / Shutterstock.com