For properly beneath $100, you should buy one share of this under-the-radar AI exchange-traded fund (ETF) that appears poised to proceed to outperform the market.
For this text, I requested myself: The place would I begin investing if I had lower than $100 to take a position?
Picture supply: Getty Photos.
An AI ETF that is concentrated and stuffed with main and worthwhile firms
This reply to my query popped into my head: I would need a concentrated exchange-traded fund (ETF) centered on main and worthwhile firms closely concerned in synthetic intelligence (AI), however with sufficient variations amongst themselves.
Why an ETF? As a result of I would not wish to put all my (investing) eggs in a single basket.
Why AI? As a result of it is poised to be the most important secular pattern in lots of many years and even generations.
Why concentrated? As a result of I consider if traders are going to purchase a really diversified ETF, they may as properly purchase the complete market, so to talk, and purchase an S&P 500 index ETF. Certainly, shopping for an S&P 500 index fund is a good suggestion for a lot of traders, and really helpful by investing legend Warren Buffett. That mentioned, over the long term, I feel an AI ETF stuffed with solely main and worthwhile firms will beat the S&P 500 index.
Roundhill Magnificent Seven ETF (MAGS): Overview
And bingo! There may be such an ETF — the Roundhill Magnificent Seven ETF (MAGS 1.83%). It has seven holdings — the so-called “Magnificent Seven” shares: 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 shares (shares with market caps over $200 billion) got the Magnificent Seven title a few years in the past by a Wall Road analyst resulting from their sturdy progress and huge affect on the general market. The title comes from the title of a 1960 Western movie.
Two different foremost traits I like about this ETF:
- Its expense ratio is affordable at 0.29%.
- It gives equal-weight publicity to the seven shares. At every quarterly rebalancing, the shares might be reset to an equal weighting of about 14.28% (100% divided by 7).
Since its inception in April 2023 (nearly 2.5 years), the Roundhill Magnificent Seven ETF has returned 160% — 2.4 occasions the S&P 500’s 65.9% return.
Roundhill Magnificent Seven ETF (MAGS): All inventory holdings
Shares are listed so as of present weight in portfolio. Remember the ETF is rebalanced quarterly to make shares equally weighted.
|
Holding No. |
Firm |
Market Cap |
Wall Road’s Projected Annualized EPS Progress Over Subsequent 5 Years |
Weight (% of Portfolio) |
1 Yr/ 10-Yr 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% |
|
Total ETF |
N/A |
Whole web belongings 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% |
Knowledge sources: Roundhill Magnificent Seven ETF, finviz.com, and YCharts. EPS = earnings per share. Knowledge as of Sept. 12, 2025.
All these firms are worthwhile leaders of their core markets, and closely concerned in AI. Nvidia produces AI tech that allows others to make use of AI, whereas the opposite firms primarily use AI to enhance their present merchandise and develop new ones.
Alphabet’s Google is the world chief in web search. Its cloud computing enterprise is No. 3 on the planet, behind Amazon Internet Companies (AWS) and Microsoft Azure. The corporate additionally has different companies, notably its driverless automobile subsidiary, Waymo. (You may learn right here why I consider Nvidia is the perfect driverless automobile inventory.)
Nvidia is commonly described because the world’s main maker of AI chips — and that it’s. Nevertheless it’s far more. It is the world chief in supplying expertise infrastructure for enabling AI. It is also the worldwide chief in graphics processing models (GPUs) for laptop gaming.
Apple’s iPhone holds the No. 2 spot within the international smartphone market, behind Samsung. Nevertheless, it dominates the U.S. market. The corporate’s companies enterprise is engaging, because it consists of recurring income and has been steadily rising.
Amazon operates the world’s No. 1 e-commerce enterprise and the world’s No. 1 cloud computing enterprise. It additionally has many different companies, notably its Recent and Amazon Prime Now (Complete Meals) grocery supply operations.
Meta Platforms operates the world’s main social media web site, Fb, in addition to Instagram, Threads, and messaging app WhatsApp.
Microsoft’s Phrase has lengthy been the world’s main phrase processing software program. Phrase is a part of Microsoft Workplace, a set of common software program for private computer systems (PCs). Its Azure is the world’s second-largest cloud computing enterprise.
Tesla stays the No. 1 electrical automobile (EV) maker, by far, within the U.S. regardless of struggling not too long ago. Within the first half of 2025, China’s BYD surpassed Tesla because the world’s chief in all-electric automobiles by variety of models bought. CEO Elon Musk touts that the corporate’s robotaxi and Optimus humanoid robotic companies will finally be bigger than its EV gross sales enterprise.
In brief, the Roundhill Magnificent Seven ETF is poised to proceed to profit from the expansion of synthetic intelligence. Technically, it would not have a long-term historical past. But when it had existed a few years in the past, it is simple to inform that its long-term efficiency can be very sturdy as a result of the long-term performances of all its holdings have been anyplace from nice to spectacular.
Beth McKenna has positions in Nvidia. The Motley Idiot has positions in and recommends Alphabet, Amazon, Apple, Meta Platforms, Microsoft, Nvidia, and Tesla. The Motley Idiot recommends BYD Firm and recommends the next choices: lengthy January 2026 $395 calls on Microsoft and brief January 2026 $405 calls on Microsoft. The Motley Idiot has a disclosure coverage.
