Here's How Much Money You'd Have if You Invested $7,000 in the "Magnificent Seven" in 2017 | The Motley Fool (2024)

FAQs

Here's How Much Money You'd Have if You Invested $7,000 in the "Magnificent Seven" in 2017 | The Motley Fool? ›

From an original $7,000 investment spread across all seven stocks, you'd have generated a return of 700%. If you had instead invested $7,000 into the S&P 500, the value of your investment today would be roughly $15,070. While you would have more than doubled your money, the returns wouldn't be nearly as impressive.

The Motley Fool has positions in and recommends Advanced Micro Devices, Alphabet, Amazon, Apple, Meta Platforms, Microsoft, Nvidia, and Tesla.

How the Rule of 72 Works. For example, the Rule of 72 states that $1 invested at an annual fixed interest rate of 10% would take 7.2 years ((72 ÷ 10) = 7.2) to grow to $2. In reality, a 10% investment will take 7.3 years to double (1.10^7.3 = 2). The Rule of 72 is reasonably accurate for low rates of return.

Five years is too short a period to expect a doubling of your investment. To achieve this target, you would need to earn a yearly return of 15 per cent, which seems highly ambitious, even for an all-equity portfolio.

1 At 10%, you could double your initial investment every seven years (72 divided by 10). In a less-risky investment such as bonds, which have averaged a return of about 5% to 6% over the same period, you could expect to double your money in about 12 years (72 divided by 6).

Dubbed the Magnificent Seven stocks, Apple, Microsoft, Google parent Alphabet, Amazon, Nvidia, Meta Platforms and Tesla lived up to their name in 2023 with big gains. But the start of the third quarter of 2024 showed a big divergence of returns.

The Magnificent Seven is, of course, a reference to the 1960s American Western film. But instead of seven cowboys, you've got Microsoft, Apple, Tesla, “Amazon, Meta, Alphabet, as well as Nvidia,” said James Angel, a finance professor at Georgetown.

One of those tools is known as the Rule 72. For example, let's say you have saved $50,000 and your 401(k) holdings historically has a rate of return of 8%. 72 divided by 8 equals 9 years until your investment is estimated to double to $100,000.

One of the key rules within my unique Income Method is the Rule of 42 - holding at least 42 income-generating investments that enable you to have reduced risk from any individual holding.

How long will it take to increase a $2200 investment to $10,000 if the interest rate is 6.5 percent? ›

Final answer:

It will take approximately 15.27 years to increase the $2,200 investment to $10,000 at an annual interest rate of 6.5%.

To turn $5,000 into more money, explore various investment avenues like the stock market, real estate or a high-yield savings account for lower-risk growth. Investing in a small business or startup could also provide significant returns if the business is successful.

Expert-Verified Answer

Under continuous compounding at an annual interest rate of 6.5%, it will take approximately 10.67 years for an initial investment of $1000 to double in value.

The table below shows the present value (PV) of $5,000 in 20 years for interest rates from 2% to 30%. As you will see, the future value of $5,000 over 20 years can range from $7,429.74 to $950,248.19.

Invest in an S&P 500 index fund

The S&P 500 also has an attractive long-term return, averaging about 10 percent annually over long periods. That means that, on average, you'll be able to double your money in just over seven years.

“The first rule of investment is don't lose. The second rule of investment is don't forget the first rule.” Buffett famously said the above in a television interview.

Plot. A gang of bandits led by Calvera periodically raids a poor Mexican village for food and supplies. After the latest raid, during which Calvera kills a villager, the village leaders decide to fight back. They send three villagers carrying their few objects of value to try and barter for weapons.

Add up those components and these seven stocks deliver 29 percent of the S&P 500's performance. Meanwhile, the S&P 500's other 490-some stocks deliver the remaining 71 percent. As great as this weighting is, it's even more lopsided in the Nasdaq 100: Apple – 8.09 percent.

What are FAANG Stocks? FAANG stocks are the publicly traded stocks of U.S. technology giants Facebook, Amazon, Apple, Netflix, and Google. They are among the best-performing technology and most well-known companies in the world.

Kurosawa was partial to European films

Perhaps Kurosawa felt that his film was too closely tied to feudal Japan to be considered adaptable. The director admitted: "The American copy is a disappointment, although entertaining. It is not a version of 'Seven Samurai.