Magnificent 7 vs the Other 493: What $10,000 in Each Would Be Worth

Over the last six years, seven stocks have powered most of the S&P 500's gains. Apple, Microsoft, Alphabet, Amazon, Meta, Tesla, and Nvidia - the Magnificent Seven - now make up roughly 30% of the index by market cap, up from around 17% at the start of 2020.

Everyone references this concentration. Almost nobody runs the actual numbers on what it meant for a portfolio. So we did. Here is what $10,000 invested in the Mag 7 vs the rest of the S&P 500 since January 2020 would be worth today.

The headline numbers

$10,000 split equally across the seven stocks in January 2020 (about $1,428 in each) is worth approximately $73,268 today. The same $10,000 in the S&P 500 (SPY) is worth $22,030. The same $10,000 in the rest of the S&P 500 - the other 493 stocks, weighted as they sit in the index - returned roughly $18,050.

What each Mag 7 stock did with $1,428

Splitting $10,000 equally puts about $1,428 into each of the seven names. Here is what that became.

Nvidia did most of the heavy lifting. The $1,428 invested in NVDA grew to over $40,000 - more than half the ending value of the entire seven-stock portfolio. Strip Nvidia out and the other six combined returned roughly +280%, still beating SPY but not by anything close to the same margin.

How we estimated the "Other 493"

There is no clean ETF that holds only the S&P 500 ex-Mag 7. To approximate, we used the contribution math that S&P Dow Jones Indices and the major sell-side desks publish: take the index's starting weights, the ending weights, and the actual SPY return.

At the start of 2020, the seven stocks were around 17% of the index. Today they sit closer to 30%. That means roughly $1,700 of an original $10,000 SPY position was in Mag 7 in January 2020, and that slice is worth around $7,000 today (about 32% of the $22,030 ending balance). The remaining $8,300 - the Other 493 - is worth roughly $15,030 today. Scale that up to a clean $10,000 starting position and the implied return is approximately +80.5%, or about 10.3% annualized.

Not bad. But not the +120% SPY delivered, and not remotely close to the Mag 7's +632%.

The chart that explains the last six years

The Mag 7 line did everything: rocketing through 2020 and 2021, getting cut nearly in half in 2022, then doubling again in 2023-2024 on the AI rerating. SPY rode that volatility but cushioned by the rest of the index. The Other 493 line is much steadier - and much flatter.

Stretching the window to ten years

Pull the start date back to January 2015 and the gap gets absurd.

• $10,000 split across the Mag 7 in 2015 is worth roughly $623,610 today (+6,136%).
• $10,000 in SPY is worth $39,210 (+292%).
• Implied Other 493 (using the same weight-shift approach): roughly $32,000 (+220%).

Nvidia's 358x return since 2015 is the single biggest driver - $1,428 in NVDA in January 2015 is worth about $511,000 today. That one stock is bigger than every other Mag 7 holding combined, and bigger than all but a handful of S&P 500 outcomes in the last 25 years.

What this means for owning an index fund

The S&P 500 is sold as a diversified bet on the U.S. economy. That is still mostly true. But over the last six years, three things became unavoidably clear from the data:

• You owned a Mag 7 fund whether you wanted to or not. Anyone holding SPY in 2024 had nearly a third of their position in seven stocks. Five of those seven sell ads, software, or chips related to a single technology trend.
• Most of the index's gains came from a few names. The Other 493 stocks did fine, but "fine" was about 10% annualized. The headline +14% annualized SPY return was juiced by the cap-weighted Mag 7 contribution.
• Equal-weight indexing told a different story. An equal-weight S&P 500 fund would have looked closer to the Other 493 line - good returns, much less concentration risk, but well behind cap-weighted SPY. That gap is exactly the AI/Mag 7 trade.

The risk this creates going forward

Concentration cuts both ways. The same dynamic that turned $10,000 into $22,000 in SPY would have shaved several thousand off the result if Mag 7 had been flat instead of up six-fold. If even two or three of those stocks underperform the broader market over the next five years, the same SPY position will lag what most retail investors expect from "the index."

That is not a prediction. The Mag 7 are some of the most profitable businesses in human history. But they are also priced as such. Apple trades at roughly 30x earnings, Microsoft at 35x, Nvidia at 50x. None of these are crash valuations - all of them assume growth keeps coming.

What you can do with this

A few things this analysis does NOT say:

• It does not say sell SPY.
• It does not say buy the Mag 7.
• It does not say buy equal-weight instead.

What it does say is that if you own a cap-weighted S&P 500 fund, you already have a heavy bet on seven specific stocks. You should know what you own. If you want to lean further into them, equal-weight Mag 7 has crushed the index. If you want less concentration, equal-weight S&P 500 funds (RSP) or international diversification do the job.

The single decision that mattered most over the last six years was whether to be overweight or underweight the seven names everyone is talking about. The S&P 500, by virtue of being cap-weighted, made that decision for most investors automatically.

Try the multi-stock comparison tool to chart any combination of the Mag 7 against SPY, or jump to our Magnificent 7 since 2020 matchup for a head-to-head ranking.

Related: Nvidia vs S&P 500 since 2020 | AI stocks since 2020 | Best investments of the 2020s