GRANOLAS – The European counterpart in the shadow of the Magnificent Seven.

While all the noise in the market is concentrated on the so-called A Magnificent Seven of US tech mega caps that is at the heart of the current bull run, another group of cap giants provide the same return BUT at the cost of much lower risk, being significantly cheaper than the Mag 7 /by metrics/ trading at a P/E of 20 versus M7’s P/E of 30. Also, the volatility of these stocks is twice as low as that of Mag 7.

Just like the Magnificent 7, this stellar basket of stocks has its own name, which may still be unknown to the masses. They are called GANOLAS – a term coined by Goldman Sachs to refer to European mega caps. /GSK (GSK), Roche (CH:ROG), ASML (ASML), Nestle (CH:NESN), Novartis (CH:NOVN), Novo Nordisk (NVO), L’Oreal (FR:OR), LVMH (FR :MC), AstraZeneca (AZN), SAP (SAP) and Sanofi (SNY)./

The companies have solid margins, and Goldman Sachs defines GRANOLAS as a suitable investment at times when the global GDP is below 3%, which the bank actually predicts for the next 3 to 5 years.

This was confirmed by GANOLAS in the current Q4 earnings season as well, with the group reporting solid growth led by Novo Nordisk’s success with slimming drugs and ASML’s surge in microchip machinery, although L’Oreal underperformed expected, partly due to the slowdown in its business in China.

While there is a myth in the markets that solid profits can be sought in US tech mega caps, in fact there are more “risk-free” risk positions under the surface without limiting the potential for returns.

This image has an empty alt attribute; its file name is image-180.png

Here’s the graphic proof – looking at the period from January 2021, to Friday’s closing levels, we see that the GRANOLAS group has completely matched the performance of the Magnificent Seven with a 63% return, BUT with an average volatility of 2018 that is twice -lower than M7.

In conclusion: For more conservative investors looking for growth outside the US for portfolio diversification, perhaps GRANOLAS is one of the best places to be. However, unlike M7, GRANOLAS does not yet have an ETF tracking their performance, so investors will have to buy each of the stocks individually.

 Head Dealer Alexander Alexandrov

Login to comment

* Rough, sarcastic and ironic language is not allowed. For such Admins Delete without notice.

Leave a Reply


Leave a comment

Varchev Absolute Trader

борсова платформа

  • Търгувай над 3000 финансови инструмента: Crypto, Форекс, Акции, Индекси, Суровини, ETF-и
  • Използвай платформа с директно изпращане ордерите на борсите
  • Best Trading Platform - "Online Personal Wealth Awards" EU награждава Varchev Absolute Trader
  • Cloud base платформа - твоят трейдинг сетъп на всяко устройство
  • Traders Talk - чуй какво движи пазарите в реално време
  • Market Sentiment - търгувай с настроенията на инвестиционите банки
  • Top movers - най-горещите трейдове във всеки един момент
  • Stocks scanner - филтрирай най-подходящите за твоя трейдинг стил пазарни инструменти
  • Heat map - Търгувай в посоката на големите играчи

Read more:
If you think, we can improve that section,
please comment. Your oppinion is imortant for us.
WARNING: Any news, opinions, research, data or other information contained within this website is provided as general market commentary and does not constitute investment or trading advice. Varchev Finance Ltd. expressly disclaims any liability for any lost principal or profits which may arise directly or indirectly from the use of or reliance on such information. Varchev Finance Ltd. may provide information, quotes, references and links to or from other sites and blogs and other sources of economic and market information as an educational service to its clients and prospects and does not endorse the opinions or recommendations of the sites, blogs or other sources of information.
Varchev Finance
chat with dealer