Connect with us

AI Insights

This Artificial Intelligence (AI) ETF Has Outperformed the Market By 2.4X Since Inception and Only Holds Profitable Companies

Published

on


For well under $100, you can buy one share of this under-the-radar AI exchange-traded fund (ETF) that looks poised to continue to outperform the market.

For this article, I asked myself: Where would I start investing if I had less than $100 to invest?

Image source: Getty Images.

An AI ETF that’s concentrated and full of leading and profitable companies

This answer to my question popped into my head: I’d want a concentrated exchange-traded fund (ETF) focused on leading and profitable companies heavily involved in artificial intelligence (AI), but with enough differences among themselves.

Why an ETF? Because I’d not want to put all my (investing) eggs in one basket.

Why AI? Because it’s poised to be the biggest secular trend in many decades or even generations.

Why concentrated? Because I believe if investors are going to buy a very diversified ETF, they might as well buy the entire market, so to speak, and buy an S&P 500 index ETF. Indeed, buying an S&P 500 index fund is a good idea for many investors, and recommended by investing legend Warren Buffett. That said, over the long run, I think an AI ETF full of only leading and profitable companies will beat the S&P 500 index.

Roundhill Magnificent Seven ETF (MAGS): Overview

And bingo! There is such an ETF — the Roundhill Magnificent Seven ETF (MAGS 1.92%). It has seven holdings — the so-called “Magnificent Seven” stocks: Alphabet (GOOG 4.38%) (GOOGL 4.53%), Amazon (AMZN 1.42%), Apple (AAPL 1.06%), Meta Platforms (META 1.18%), Microsoft (MSFT 1.01%), Nvidia (NVDA -0.10%), and Tesla (TSLA 3.54%). This ETF closed at $62.93 per share on Friday, Sept. 12.

These megacap stocks (stocks with market caps over $200 billion) were given the Magnificent Seven name a couple of years ago by a Wall Street analyst due to their strong growth and large influence on the overall market. The name comes from the title of a 1960 Western film.

Two other main traits I like about this ETF:

  • Its expense ratio is reasonable at 0.29%.
  • It provides equal-weight exposure to the seven stocks. At each quarterly rebalancing, the stocks will be reset to an equal weighting of about 14.28% (100% divided by 7).

Since its inception in April 2023 (almost 2.5 years), the Roundhill Magnificent Seven ETF has returned 160% — 2.4 times the S&P 500’s 65.9% return.

Roundhill Magnificent Seven ETF (MAGS): All stock holdings

Stocks are listed in order of current weight in portfolio. Keep in mind the ETF is rebalanced quarterly to make stocks equally weighted.

Holding No.

Company

Market Cap

Wall Street’s Projected Annualized EPS Growth Over Next 5 Years

Weight (% of Portfolio)

1 Year/ 10-Year Returns

1

Alphabet $2.9 trillion 14.7% 17.72% 55.9% / 677%

2

Nvidia $4.3 trillion 34.9% 15.00% 49.3% / 32,210%

3

Apple $3.5 trillion 8.8% 14.13% 5.6% / 812%

4

Tesla $1.3 trillion 13.4% 13.81% 72.3% / 2,270%

5

Amazon $2.4 trillion 18.6% 13.30% 22% / 762%
6 Meta Platforms $1.9 trillion 12.9% 13.16% 44.3% / 725%
7 Microsoft $3.8 trillion 16.6% 12.76% 20.3% / 1,250%

Overall ETF

N/A

Total net assets of $2.86 billion

N/A

100%

40.5% / N/A

N/A

S&P 500

N/A

N/A

N/A

19.2% / 300%

Data sources: Roundhill Magnificent Seven ETF, finviz.com, and YCharts. EPS = earnings per share. Data as of Sept. 12, 2025.

All these companies are profitable leaders in their core markets, and heavily involved in AI. Nvidia produces AI tech that enables others to use AI, while the other companies mainly use AI to improve their existing products and develop new ones.

Alphabet’s Google is the world leader in internet search. Its cloud computing business is No. 3 in the world, behind Amazon Web Services (AWS) and Microsoft Azure. The company also has other businesses, notably its driverless vehicle subsidiary, Waymo. (You can read here why I believe Nvidia is the best driverless vehicle stock.)

Nvidia is often described as the world’s leading maker of AI chips — and that it is. But it’s much more. It’s the world leader in supplying technology infrastructure for enabling AI. It’s also the global leader in graphics processing units (GPUs) for computer gaming.

Apple’s iPhone holds the No. 2 spot in the global smartphone market, behind Samsung. However, it dominates the U.S. market. The company’s services business is attractive, as it consists of recurring revenue and has been steadily growing.

Amazon operates the world’s No. 1 e-commerce business and the world’s No. 1 cloud computing business. It also has many other businesses, notably its Fresh and Amazon Prime Now (Whole Foods) grocery delivery operations.

Meta Platforms operates the world’s leading social media site, Facebook, as well as Instagram, Threads, and messaging app WhatsApp.

Microsoft’s Word has long been the world’s leading word processing software. Word is part of Microsoft Office, a suite of popular software for personal computers (PCs). Its Azure is the world’s second-largest cloud computing business.

Tesla remains the No. 1 electric vehicle (EV) maker, by far, in the U.S. despite struggling recently. In the first half of 2025, China’s BYD surpassed Tesla as the world’s leader in all-electric vehicles by number of units sold. CEO Elon Musk touts that the company’s robotaxi and Optimus humanoid robot businesses will eventually be larger than its EV sales business.

In short, the Roundhill Magnificent Seven ETF is poised to continue to benefit from the growth of artificial intelligence. Technically, it doesn’t have a long-term history. But if it had existed many years ago, it’s easy to tell that its long-term performance would be very strong because the long-term performances of all its holdings have been anywhere from great to spectacular.

Beth McKenna has positions in Nvidia. The Motley Fool has positions in and recommends Alphabet, Amazon, Apple, Meta Platforms, Microsoft, Nvidia, and Tesla. The Motley Fool recommends BYD Company and recommends the following options: long January 2026 $395 calls on Microsoft and short January 2026 $405 calls on Microsoft. The Motley Fool has a disclosure policy.



Source link

Continue Reading
Click to comment

Leave a Reply

Your email address will not be published. Required fields are marked *

AI Insights

Answering the question of which AI tools deliver measurable value

Published

on


Silicon Valley kingmakers

Meanwhile, the investor lineup reads like a who’s who of Silicon Valley’s kingmakers. Sequoia’s Roelof Botha and “solo GP” Elad Gil represent the kind of money that moves markets and shapes entire industries. Dramatic as it may sound, their funding decisions often preview which technologies will dominate enterprise conversations within two years, making their perspectives essential intelligence for anyone planning technology strategy.

The programming extends well beyond AI and public markets. The CEO of Waymo will showcase how autonomous systems are reshaping transportation, while Netflix’s CTO will provide a rare glimpse into the streaming infrastructure that powers global entertainment. Perhaps most intriguingly, Kevin Rose—who founded Digg, sold it, then recently rescued it from corporate ownership—will discuss the art of platform resurrection in an era of constant digital disruption.

Disrupt takes place as both TechCrunch and San Francisco reassert their respective primacies — the publication as tech journalism’s defining voice, the city as technology’s undisputed capital. It also promises to be entertaining, as these events always are.



Source link

Continue Reading

AI Insights

AI used for taking notes at UVM Medical Center

Published

on


BURLINGTON, Vt. (WCAX) – Artificial intelligence might be taking notes at your next doctor’s appointment.

Last year, we told you how the University of Vermont Health Network was tapping into AI to streamline doctor-patient conversations.

Over a year later, network officials say it’s making a mark.

Staff say they used to spend an hour or more reviewing notes from their shift, often eating into family or downtime.

There’s no scribbling pen or clacking keyboard in sight as emergency physician Dan Peters walked through a mock appointment at the University of Vermont Medical Center.

That’s because an app is taking notes for him.

“I think my initial thoughts were this is going to be game-changing in terms of time savings for documentation,” said Peters.

The app, called Abridge, summarizes doctor-patient conversations.

Justin Stinnett-Donnelly, the network’s chief health information officer, says it boosts providers’ mental health and bedside manner.

“It changes the interaction. You’re able to be much more focused on the conversation with the patient. And it actually reduces what we call cognitive burden,” said Stinnett-Donnelly.

A pilot study at UVMMC last spring found that Abridge halved clinicians’ cognitive load while more than doubling their professional fulfillment.

Peters is proof. He says Abridge cut his routine hour-long note evaluations in half.

“To have the assistance has been significantly helpful for reducing that burden of writing all the notes and just the cognitive load of needing to remember all the details,” he said.

The note from our mock appointment with Peters was spot on, and staff say physicians always double-check the record.

“Our providers go through, they read it and they edit it for clarity, and that ultimately, it is a human reviewing that note to make sure that it is accurate for that encounter,” said Stinnett-Donnelly.

Of the 1,200 physicians and hundreds of other staff throughout the network, 500 use Abridge.

Officials say some are wary or prefer taking notes on their own. The network encourages them to give it a try.

Patients, on the other hand, don’t need much encouragement.

((Dan peters // emergency physician

Dan Peters: “If the hundreds of patient encounters where I’ve used this technology, only a single patient has said no to me.”

Reporter Sophia Thomas: “Wow. One person?”

Peters: “Only one person. I don’t think it’s specific to me. I think patients expect that we’re using this type of technology to stay on the cutting edge.“

They’re getting some of that time back thanks to AI.

Network officials say there haven’t been any breaches of private information through Abridge.

They’re currently collecting data on its benefits and plan to roll out an impact study after the two-year anniversary of adopting the app.



Source link

Continue Reading

AI Insights

AI accurately identifies questionable open-access journals by analysing websites and content, matching expert human assessment

Published

on


Artificial intelligence (AI) could be a useful tool to find ‘questionable’ open-access journals, by analysing features such as website design and content, new research has found.

The researchers set out to evaluate the extent to which AI techniques could replicate the expertise of human reviewers in identifying questionable journals and determining key predictive factors. ‘Questionable’ journals were defined as journals violating the best practices outlined in the Directory of Open Access Journals (DOAJ) – an index of open access journals managed by the DOAF foundation based in Denmark – and showing indicators of low editorial standards. Legitimate journals were those that followed DOAJ best practice standards and classed as ‘whitelisted’.

The AI model was designed to transform journal websites into machine-readable information, according to DOAJ criteria, such as editorial board expertise and publication ethics. To train the questionable journal classifier, they compiled a list of around 12,800 whitelisted journals and 2500 unwhitelisted, and then extracted three kinds of features to help distinguish them from each other: website content, website design and bibliometrics-based classifiers.

The model was then used to predict questionable journals from a list of just over 15,000 open-access journals housed by the open database, Unpaywall. Overall, it flagged 1437 suspect journals of which about 1092 were expected to be genuinely questionable. The researchers said these journals had hundreds of thousands of articles, millions of citations, acknowledged funding from major agencies and attracted authors from developing countries.

There were around 345 false positives among those identified, which the researchers said shared a few patterns, for example they had sites that were unreachable or had been formally discontinued, or referred to a book series or conference with titles similar to that of a journal. They also said there was likely around 1780 problematic journals that had remained undetected.

Overall, they concluded that AI could accurately discern questionable journals with high agreement with expert human assessments, although they pointed out that existing AI models would need to be continuously updated to track evolving trends.

‘Future work should explore ways to incorporate real-time web crawling and community feedback into AI-driven screening tools to create a dynamic and adaptable system for monitoring research integrity,’ they said.

 

 



Source link

Continue Reading

Trending