Roundhill Magnificent Seven ETF (MAGS) bundles the seven mega-cap stocks at equal weight, but equal weighting caps upside while preserving full downside exposure.

MAGS holds Alphabet, Amazon, Apple, Meta, Microsoft, NVIDIA, and Tesla in equal-weight slices rebalanced quarterly. The fund has gathered roughly $4.7 billion in assets and returned 33% over the past year, compared with 37% for the Invesco QQQ over the same window.

Equal weighting mechanically trims winners each quarter and tops up laggards. In a year where Alphabet did most of the work, this forced rebalancing cost upside that a market-cap-weighted vehicle would have captured. The fund uses physical share holdings combined with total return swaps (contractual claims tracking the stocks) to maintain compliance.

Three constraints apply: each holding is roughly 14% of the fund (so a regulatory shock to one name moves the basket with no offset), counterparty exposure through Goldman Sachs and other dealers in swap arrangements, and a 0.29% expense ratio running roughly six times higher than Vanguard Mega Cap Growth ETF at 0.05%.

MAGS fits as a 5% to 15% satellite for investors who want clean Mag Seven exposure without managing seven positions. Skip it if you want diversified growth, prefer to avoid swap-based structures, or want market-cap weighting to carry the strongest names higher without quarterly trimming.