[ad_1]
David Gras:
Yes, Jeff, last year was a huge turning point.
So you mentioned the Magnificent Seven. The name was coined by Michael Hartnett, an investment strategist at Bank of America. He admitted to being a fan of this 1960 western starring Yul Brynner and Eli Wallach, which is why he gave them their name.
However, those seven stocks are Alphabet, Amazon, Apple, Meta, Microsoft, Nvidia, and Tesla. And as you say, these companies are technology companies, and I think most of them are related to AI, or are interested in AI, or do research on AI, and Tesla is I think it’s kind of an exception. At the other end of the spectrum, Nvidia is the company that designs most of the microchips used in supercomputers that power technology that enables companies to use AI.
So they actually outperformed the market. Last year, the S&P 500 rose his 24%. These seven stocks are up more than 100% in the last year. Therefore, they have carried many burdens here. There are several reasons for that. AI is also part of that.
The other has to do with the fact that these companies are so ingrained in our lives, that we use them every day, that they have staying power even in the face of any economic downturn. And in the end, they have a lot of cash on hand. We are at a stage where interest rates are higher than they have been for a really long time.
Many companies have to borrow money if they want to expand their business. They have to borrow money at higher interest rates. These seven companies don’t have to do that, Jeff, because they have a lot of money on hand.
[ad_2]
Source link
