"Nasdaq Correction: Why I Took Advantage of a 20% Sell-Off to Buy More of This Magnificent 7 Stock"

The Nasdaq Composite has just hit a 10% correction from its recent highs, and while some investors might be panicking, I see this as a golden opportunity. The tech-heavy index has been the best-performing major market index for the past two years, but it hasn't started 2025 on a high note. However, this correction has created some interesting opportunities for long-term investors to put money to work. After all, the tech sector is likely to be one of the least-affected by tariffs, and while some of the biggest momentum stocks remain richly valued even after a correction, there are some that look remarkably attractive right now.

One of the stocks that has caught my eye is Tesla (TSLA.US). The electric vehicle giant has seen its stock price drop by approximately 20% since the beginning of 2024, primarily due to weakened demand for electric vehicles. This sell-off has made Tesla's stock more attractively priced, presenting a potential buying opportunity for long-term investors.




Despite the recent sell-off, Tesla remains one of the Magnificent 7 stocks, a group of tech giants that have dominated the market in recent years. These companies, which include Apple, Microsoft, Google, Amazon, Meta Platforms, Nvidia, and Tesla, have shown remarkable resilience and growth potential. For instance, the Magnificent 7's total return rate in 2023 reached an astonishing 107%, far exceeding the MSCI US Index, which provided investors with about 27% return. This data underscores the strong performance of these stocks and their ability to deliver substantial returns over the long term.

Furthermore, the financial performance and market leadership of the Magnificent 7 make them attractive for long-term investors. The report highlights that the Magnificent 7's total market value would make it the world's second-largest national-level securities exchange, far exceeding the second-ranked China A-share market and twice the total market value of the fourth-ranked Japanese stock market. This highlights the financial strength and market influence of these companies, which bodes well for their long-term investment potential.

In addition, the current market environment, characterized by economic resilience, strong corporate profitability, and favorable geopolitical factors, supports investing in the Magnificent 7 stocks during a correction. The U.S. economy has shown resilience despite high benchmark interest rates, and American enterprises have maintained strong sales and profitability. The labor market is robust, with an expected addition of nearly 300 million jobs in 2023, providing a solid foundation for consumer spending. U.S. companies have successfully raised prices and implemented cost-cutting measures, transferring the impact of inflation to consumers and leading to a significant increase in corporate profit margins.

However, it is important to note that the high concentration of market power in the Magnificent 7 stocks raises concerns about market risks. The report suggests that the investment opportunities in the U.S. stock market may expand beyond the Magnificent 7 in the future, indicating that while these stocks may continue to lead the market, there are other stocks and sectors that could also provide attractive investment opportunities in the long term.

In conclusion, while the 20% sell-off in Tesla's stock price is a result of weakened demand for electric vehicles, the long-term investment potential of the Magnificent 7, including Tesla, remains strong. The financial performance, market leadership, and potential for future growth make these stocks attractive for long-term investors. During a market correction, it is important to look for fundamentally strong companies with growth potential, and Tesla fits this description. Investors who buy now could be very glad they did in a few years, as these companies have great leadership and massive opportunities. However, it is also important to note that there is no way to know how much longer the recent market turbulence will persist, and investors should be prepared for potential volatility.