Magnificent Seven Stocks Show Lowest Correlation in Over a Decade

The correlation among the Magnificent Seven tech giants — Alphabet, Amazon, Apple, Meta Platforms, Microsoft, Nvidia, and Tesla — has dropped to its lowest level in more than ten years. CNBC's analysis of the rolling 60-day correlation for the 21 unique pairs of these stocks shows that this group no longer moves as a cohesive unit.

This fragmentation challenges investors to evaluate each stock on its own merits rather than treat the group as a single trade. The Roundhill Magnificent Seven ETF (MAGS) has risen 7% year to date, lagging the S&P 500's 12% gain. Tesla and Meta have declined in 2026, while Nvidia and Apple have outperformed the broader market. Microsoft and Alphabet are set to report earnings after market close Wednesday, and Amazon will report earnings Thursday.

Market watchers highlight that different exposures to AI and other growth drivers are causing this divergence. Each company faces unique fundamentals, with investors paying close attention to cloud growth, AI applications, device sales, semiconductor demand, and potential new ventures like Tesla's interest in robotics and AI. This individual focus on companies’ core drivers means the Magnificent Seven are no longer trading as one, which affects portfolio strategies for investors invested in these major stocks.

Understanding this breakdown in correlation matters for investors because it signals that the returns of these market leaders will vary more independently going forward. This change impacts the diversification and risk evaluation when investing in this influential group of stocks (MAGS).