Have you ever invested in FAANG stocks, or the Magnificent 7, a collection of technology-focused U.S. stocks? In 2013, four tech stocks stood out, collectively known as “FANG.” started to be called. In 2017, the acronym expanded to include Facebook, Amazon, Apple, Netflix, and Google.
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In 2023, the nickname “Magnificent 7” emerged to describe a growing group of tech stocks, including Microsoft, Amazon, Meta Platforms (formerly Facebook), Apple, Alphabet Inc. (formerly Google), Nvidia Corporation, and Tesla.
But there’s another name that savvy investors should know. It’s GRANOLAS. These brands (necessarily) have nothing to do with the crunchy treats favored by hikers and healthy snack lovers. Rather, these are his 11 European-based companies representing a wide range of sectors of the market, from luxury brands to biopharmaceutical companies.
Despite being international brands, many are traded on the New York Stock Exchange. Still, they do not have a strong correlation with the S&P 500, according to SeekingAlpha.com.
The stocks included in this category are GSK, Roche, ASML, Nestlé, Novartis, Novo Nordisk, L’Oréal, LVMH, AstraZeneca, SAP, and Sanofi.
Investors today find multiple reasons to diversify their holdings into GRANOLAS stocks.
GRANOLAS stock has outperformed the market since June 2022
This diverse group of stocks has driven 60% of European stock market gains in the past year, according to analysts at Goldman Sachs, and has outperformed FAANG stocks over the past two years, according to Morningstar.com.・Com reported.
Additionally, most of the stocks listed offer a dividend of 2% to 2.5%.
bring about diversification
While tech stocks tend to do well in the U.S., a portfolio made up of FAANG stocks doesn’t offer much diversification. GRANOLAS stocks, on the other hand, represent a wide range of sectors, from consumer goods to fashion, technology and healthcare.
It also does not track the S&P 500 Index or the Nasdaq Index. If your portfolio is mostly made up of US stocks, adding just a handful of his GRANOLAS stocks could be beneficial.
Due to the diversity of companies on the list, this collection also shows lower volatility than the Magnificent 7. “Granolas’ realized volatility is on average twice as low as the Magnificent 7,” Chief Global Equity Strategist Peter Oppenheimer recently told SeekingAlpha. .com.
The company has a strong foundation
Each stock in the GRANOLAS classification represents a strong, stable company focused on what people need or want. Some companies, like LVMH and L’Oréal, have brand names that stand the test of time.
Some companies focus on high-demand technologies or pharmaceuticals with huge markets. Novo Nordisk has soared 82% over the past year on the launch of weight-loss drugs Ozempic and Wigovy.
conclusion
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If you want diversification beyond tech stocks and the S&P 500, consider GRANOLAS as a solid way to build your portfolio.
GOBankingRates Details
This article originally appeared on GOBankingRates.com: 3 Reasons to Diversify Beyond the ‘Magnificent 7’ and Consider GRANOLA Stock
