See how removing the Magnificent 7 could flatten S&P 500 returns, reshape 401(k) portfolios and change retirement growth for investors. Find out more now.
Most people invested in the stock market, whether through retirement accounts or other kinds of brokerage accounts, are likely holding stock in the Magnificent 7. These seven megacap tech companies have driven a huge portion of U.S. market gains over the past few years, especially since 2023.
They are Apple (AAPL), Microsoft (MSFT), Nvidia (NVDA), Google’s parent company Alphabet (GOOGL), Amazon (AMZN), Meta Platforms (META) and Tesla (TSLA).
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Because the S&P 500 and most index funds are weighted by company size, these stocks now make up an unusually large share of the overall market. I asked ChatGPT to help me play out what it would look like if these seven stocks did not dominate the market, particularly on the portfolios of the average American.
Also see what investors should expect from the Magnificent 7 in 2026.
If you’ve been enjoying your portfolio gains, you might have the Magnificent 7 to thank, according to ChatGPT, as they account for roughly 25% to 35% of the S&P 500’s total value, depending on recent price moves. In some recent years, they have contributed the majority of the index’s gains.
If they disappeared from the market, the S&P 500’s recent returns would be significantly lower, and so would your portfolio gains. Additionally, some years that looked like strong bull markets would look modest or even flat.
In other words, ChatGPT said that a lot of what feels like “the market doing great” has actually been “seven stocks doing great.” Your portfolio performance has been heavily influenced by a small handful of companies.
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Right now, many workers don’t realize how tech-concentrated their “diversified” retirement accounts really are. Most Americans own the Magnificent 7 indirectly through one of the following kinds of funds:
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S&P 500 index funds
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Total market index funds
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Target-date retirement funds.
Without those seven companies, the tech percentage of your portfolio would shrink dramatically. On the other hand, other sectors could have more influence. It could also potentially decrease volatility.
Removing the Magnificent 7 would make portfolios look more balanced across sectors, but it would also likely show slower growth.
When it comes to risk, ChatGPT said there are two sides to this.