Key Takeaways
- • Calpers, the world's fifth-largest pension fund managing more than $600 billion, cut its combined direct shareholdings in the Magnificent Seven tech stocks by 26% in the first half of 2026, according to FT calculations based on regulatory filings.
- • Calpers is shifting capital toward private equity to diversify beyond a handful of stock market leaders, with deputy chief investment officer Anton Orlich telling the Financial Times that public equity valuations look expensive.
- • Neocloud AI infrastructure stocks, including CoreWeave, Cipher Digital and IREN, fell in Monday's pre-market trading after Elon Musk warned that financing had largely dried up for AI data center companies lacking substantial revenue outside AI.
- • The Roundhill Magnificent Seven ETF (MGAS) is up 7% year to date, led by Apple's 34% gain, while Meta, Alphabet and Tesla are down for the year.
Summary
California's public pension fund Calpers, the world's fifth-largest pension fund, reduced its combined direct shareholdings in the so-called Magnificent Seven technology stocks by 26% during the first half of 2026, according to calculations by the Financial Times based on regulatory filings. The fund, which manages more than $600 billion, is cutting its exposure to major U.S. technology companies as concerns grow over stretched valuations and the sustainability of the artificial intelligence investment boom.
The Magnificent Seven group includes Apple, Microsoft, Alphabet, Amazon, Nvidia, Meta Platforms and Tesla. Performance across the group has been mixed. The Roundhill Magnificent Seven ETF (MGAS) is up 7% year to date, led by a 34% gain in Apple and a 12% rise in Nvidia, while Meta, Alphabet and Tesla are all down for the year.
Calpers is directing additional capital into private equity, seeking to spread its investments across a broader range of companies and reduce dependence on a small number of market leaders. Deputy chief investment officer Anton Orlich told the Financial Times that public equity valuations looked expensive and that the technology giants could underperform other investments.
The repositioning coincides with a sell-off in neocloud stocks. Elon Musk, whose SpaceX raised $40 billion in debt to purchase GPUs for AI calculations, warned that financing had largely dried up for companies lacking substantial revenue outside AI data centers and predicted consolidation among neocloud providers. That pressure carried into Monday's pre-market trading, when CoreWeave (CRWV), Cipher Digital and IREN all declined.
The Magnificent Seven group includes Apple, Microsoft, Alphabet, Amazon, Nvidia, Meta Platforms and Tesla. Performance across the group has been mixed. The Roundhill Magnificent Seven ETF (MGAS) is up 7% year to date, led by a 34% gain in Apple and a 12% rise in Nvidia, while Meta, Alphabet and Tesla are all down for the year.
Calpers is directing additional capital into private equity, seeking to spread its investments across a broader range of companies and reduce dependence on a small number of market leaders. Deputy chief investment officer Anton Orlich told the Financial Times that public equity valuations looked expensive and that the technology giants could underperform other investments.
The repositioning coincides with a sell-off in neocloud stocks. Elon Musk, whose SpaceX raised $40 billion in debt to purchase GPUs for AI calculations, warned that financing had largely dried up for companies lacking substantial revenue outside AI data centers and predicted consolidation among neocloud providers. That pressure carried into Monday's pre-market trading, when CoreWeave (CRWV), Cipher Digital and IREN all declined.
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