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this is um 2023 performance for something that you've heard probably if you read the financial page it's called The Magnificent 7 so brokers who want to get you to do things have wonderful ways of inventing names for things uh the bricks The Magnificent Seven the fangs etc etc etc The Magnificent Seven of these stocks seven stocks listed here um you'll see that the NASDAQ the US index delivered 43% return last year a lot that's a lot right these seven stocks delivered 2/3 of that return if you didn't own all or most of these stocks it was close to impossible to outperform basically um looking at them we don't own any Nvidia uh and I know that um Ian who does alert us if he's got a question that we need slides for has got a question for us later on about the um hype if that's what it is or the story around um AI which is driven this company which designs chips for the gpus which are use driving the the models for AI um we don't owning that we do own some meta platforms we're never going to own Tesla uh we did own Amazon and I sold it we'll probably do with that a bit later in terms of how how good or bad an idea that one was we own alphabet we do own Microsoft we do own some apple but we own a very small amount of Apple here's funmi's latest stf filing as you can see they have 12.5% Microsoft 7.4% meta 4.1% Google and finally just 1.08% positions and the reason for that is we started buying it a year and a half ago um when it was rated about the same as the S&P index we thought if it's the same as the S&P index in rating we're probably right because it's a lot better than the S&P average started buying it and we foresaw correctly that it was going to have a series of quarters of poor sales uh coming up it's had five or six in a row since we started buying the only thing we didn't foresee is that the share price would go up 50% while that was happening so we haven't got enough apple or we didn't have enough Apple so you know that was one of that was the 202 tree background to Performance just to let you know okay and just to give you a reflection on it the Magnificent 7 I'm a I like movies a lot very keen on movies and I think you can learn a lot from movies uh one of the things that I think you learn if you watch enough of them is there's no such thing as a new movie plot everything's been done before basically it all gets rerun and the Magnificent Seven which they've used as this term for these seven stocks which drove the market performance last year of course comes from the 1960 movie of the same name have we seen this movie before you bet we have cuz in 1954 the Seven Samurai uh was released and uh the Magnificent 7 is clearly a copy of it they just wear cowboy hats and carry guns instead of Swords so um so we haven't seen this movie before and you know the Magnificent Seven stocks we've seen this movie before in 7th of April 2000 Goldman Sachs uh named their super seven um I'm guessing that they maybe had somebody who liked Lotus or katrum cars on the staff at the time for super 7even um and here they are First Data Oracle pteridine PMC EMC squar Cisco and Dell those were the Magnificent 7 of 2000 how did they do here's the Super 7 from more than two decades ago and most of the names here are completely irrelevant today that is the hard side of capitalism showcasing the dynamism and volatility of the market this reflection underscores a fundamental truth of investing today's Titans can become tomorrow's footnotes the evolution from the Super 7 of 2000 to the Magnificent of today is not just a tale of companies rising and falling it is a vivid illustration of capitalism Relentless cycle of innovation and disruption as investors it reminds us to stay adaptable informed and always ready to reassess our positions in light of the everchanging market landscape there you go there's the next five years performance there and there's the next uh 10 years performance there basically uh Julian and his team who have to prepare these things I dream up from time to time struggled to find some of these CU they near exist anymore you know in terms of where they they got to after this and there's a great saying history doesn't repeat itself but it Rhymes right and uh I think we may find that if we had on your behalf entered into a full-blown let's own the Magnificent s last year we might eventually be into uh watching the the sequel to it uh and with the same outcome basically um just to give you one other illustration this is about how this is a portfolio and um we have to be it's nice to own things that go up a lot it's great but you have to be a little bit careful about what you get on the way to them going up a lot and how it affects our decisions and your decisions here's a stock a real stock you could have bought it in February 2018 at $127 a share uh by September 2021 it was at 273 so it more than doubled and recently it's been trading at $484 uh so it made 196% return during the uh the five and a bit years in there pretty good isn't it want to own it I want to own it I'm me if you are um the problem is it did this right yeah it went from there to there which is what you've just seen but it had these three really big downturns one of them was 76% right how would you feel if you owned this stock even though we now know with the benefit of 2020 hindsight that it mov a great returner how would you feel round about there yeah now I can tell you how I felt because it's meta platform right if you two have recognized this company as soon as you saw the numbers or the charts I want to congratulate you on holding or even buying an holding meta like me those were the times I actually wrote a comment on a Joseph Carson video where he covered what was going wrong with meta he's a great YouTuber and I will leave a link to that video in the comments as well in the comment I said Apple's changes took $10 billion of meta's Top Line annually according to meta their expenditure is not all metaverse actually more of it is AI capabilities to better compete with Tik toac people hated Zach when he bought Instagram and WhatsApp they have close to 3 billion daily users worldwide and it is literally the most hated stock I don't think Mark will be spending all that much on metaverse without any results for years to come as well meta is my top holding and I'm down a lot but as Buffett said if you can stomach a 50% decline you should not invest in individual companies I see nothing wrong with the fundamentals of the business and the expenditure is expected to top in 2023 and cool off thereafter according to analysts I think investors who go long meta will be handsomely rewarded in 5 years this video is a good beer case though and I might be wrong as well we will see well it turned out the investors didn't even need to wait for 5 years that's what we've we've lived with through this and to give you a picture of this is what we manage is a portfolio it has some things in there which are quite stayed which don't ever produce returns like this you know the Unilever and the Proctor and gambles and the Pepsi go of this world we don't own all of these even if we thought we could identify a magnificent s we would not take the risk of owning them right because they can do things like that and when they do things like that it causes you to get worried and us to get worried and both of us quite possibly to make bad decisions based upon those emotions um the the meta platform story I was in in New York sort of round about here at one point um meeting with a a big um wealth management private office that we manage money for in the United States and the young associate Young than me anyway associate was giving me a reasonable hard time about meta and what we thought about it and I was giving him our answers and so on and his uh much older and obviously wiser boss uh said every portfolio should have one stock like that if you believe what you're saying you should buy more and we did and it worked and it's great the most important thing that that man said to me was one stock right you don't want 27 of them because if they all move in unison like that I'm afraid it's game over right we're not all going to have the fortitude to live through that even if we should have in the end I believe Terry Smith made great points here and let me just say that I also see incredibly good future prospects for these companies in the future they have a lot of room to grow as businesses the problem is some of their valuations especially Tesla and Nvidia in my opinion while I don't think this seven will be irrelevant 20 years from now just like Goldman's super 7even from 20 years ago that doesn't mean they will deliver great returns as stocks at least some of them if I had to guess I would say Amazon will have the highest returns in 20 years and either Tesla or Nvidia the lowest but that's just my personal opinion and I barely follow these companies so there is a great chance that I will be wrong on this one and since I'm neither long or short on them that is irrelevant for me it is in my two heart pile and the reason I don't follow these companies is simple almost every eye in the financial world is covering them and while anomalies like meta a couple of years ago can happen it is unlikely for the most part so what I try to do is look at places with much less eyes on companies like rash or t airports if you want to learn more about the businesses that I cover please check my other videos also subscribe and ring the bell if you like the content so you won't miss my future videos that was it for today and I'll see you in the next one
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