The phenomenon of the ‘Magnificent Seven’ stocks arose from market consolidation, where dominant companies continue to grow by acquiring potential competitors and scaling efficiently. This group includes Apple (AAPL), Microsoft (MSFT), Alphabet (GOOGL), Meta Platforms (META), Amazon.com (AMZN), Nvidia (NVDA), and Tesla (TSLA), as coined by Bank of America analyst Michael Hartnett in April 2023, according to CoinGecko. These stocks contributed to 88% year-to-date returns for shareholders at that time.
Despite Tesla’s recent struggles, the Magnificent Seven still outperform the broader market. The Roundhill Magnificent Seven ETF (MAGS) returned 35.8% year-to-date compared to the S&P 500 (SPX) at 15.1% for the same period. These stocks represent about 30% of the S&P 500, highlighting their significance in the US tech market.
Has Crypto Outperformed The Magnificent Seven?
While cryptocurrencies like Bitcoin (BTC) and Ethereum (ETH) have managed to outperform most of the Magnificent Seven stocks, they started with significantly lower market caps in 2019. Over five years, from May 7, 2019, to June 28, 2024, the market cap performance of these assets is as follows:
| Asset | 2019 Market Cap | 2024 Market Cap | % Change |
|---|---|---|---|
| Microsoft (MSFT) | $961.84B | $3.322T | 245.40% |
| Apple (AAPL) | $933.37B | $2.230T | 246.10% |
| Nvidia (NVDA) | $105.42B | $3.039T | 2782.80% |
| Alphabet (GOOGL) | $818.42B | $2.258T | 175.90% |
| Amazon (AMZN) | $945.77B | $2.011T | 112.60% |
| Meta Platforms (META) | $541.70B | $1.279T | 136.10% |
| Tesla (TSLA) | $43.80B | $631.08B | 1340.80% |
| Bitcoin (BTC) | $103.98B | $1.250T | 1102.20% |
| Ethereum (ETH) | $18.16B | $421.00B | 2218.30% |
Nvidia and Tesla stand out with their rapid valuation increases of 2,782.8% and 1,340.8%, respectively. Combined, these companies have a market cap of $15.770 trillion, a 262.5% increase from five years ago.
Nvidia Outperformed Bitcoin & Ethereum Over The Last Five Years
Nvidia is the only stock in the Magnificent Seven that outperformed both Ethereum and Bitcoin over the five-year period. Its market cap grew from $105.42 billion to $3.039 trillion, a 2,782.8% increase. As of June 28, 2024, Bitcoin and Ethereum make up 66.9% of the total crypto market cap of $2.46 trillion, with Bitcoin at $1.250 trillion (49.9%) and Ethereum at $421 billion (17.0%).
Ethereum’s market cap increased from $18.16 billion to $421 billion, representing a 2,218.3% growth. Bitcoin’s market cap increased from $103.98 billion to $1.250 trillion, representing a 1,102.2% growth. Ethereum outperformed Bitcoin by 1.7x due to its later launch and lower initial market cap.
How Does the Market Cap of Magnificent Seven Compare Against Bitcoin & Ethereum?
As of June 28, 2024, the combined market caps of the Magnificent Seven, Bitcoin, and Ethereum total $17.44 trillion, with Bitcoin and Ethereum comprising 9.6% of this value. Nvidia and Ethereum achieved the highest market cap growth over the past five years at 2,782.8% and 2,218.3%, respectively.
Bitcoin and Ethereum Market Cap Divergence
Bitcoin and Ethereum’s market caps have experienced various bullish and bearish events, such as PayPal’s integration of cryptocurrencies in October 2020 and the collapse of Terra (LUNC) in May 2022. The SEC’s approval of 11 Bitcoin ETFs on January 11, 2024, marked a significant milestone, leading to a 50% market cap growth for both Bitcoin and Ethereum. However, Ethereum’s market is still smaller than Bitcoin’s, making its performance less impressive in comparison.
Methodology
The study examined the market cap of the Magnificent Seven stocks versus Bitcoin and Ethereum as of June 28, 2024. Market cap data for the Magnificent Seven stocks was collected from ycharts, while Bitcoin and Ethereum data was sourced from CoinGecko.
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