The Magnificent Seven, a group of stocks beloved by American investors for their spectacular returns and soaring values, are seemingly irreplaceable in any investor's portfolio. These stocks have reached incredible heights and have become staples in the American market.

However, there's also the European GRANOLAS, which have equally impressive performances. Currently, Wall Street is focusing on a group of 11 European stocks that are driving European stock markets upward. These stocks, known by the acronym GRANOLAS, include GSK, Roche, ASML, Nestle, Novartis, Novo Nordisk, L'Oréal, LVMH, AstraZeneca, SAP, and Sanofi.

In mid-February, Goldman Sachs, which created the group and acronym in 2020, estimated that 60% of European stock market profits over the last two years came from the GRANOLAS.

In the last two years, this group of European stocks has outperformed even the so-called Magnificent Seven of the US — Alphabet, Amazon, Apple, Meta Platforms, Microsoft, Nvidia, and Tesla.

The remarkable performance of GRANOLAS in recent years raises the question: does this mean they are a good investment choice going forward? History suggests caution.

The only common feature among these stocks is their spectacular performance over a specific period. This means that their prices are currently high and potentially overvalued. This applies to both the European stocks GRANOLAS and the American Magnificent Seven.

These stocks may continue to rise in the short term, but it's almost certain that, on average, they will yield lower returns in the long run. The law of gravity eventually prevails, and when it does, Wall Street traders will simply create a new group of top stocks and give them an appealing name.

This pattern has been observed several times over the last decade. Poorly performing stocks are removed from a group, and a new group of highly performing stocks is formed. We've seen the evolution from FANG to FAANG, then to FAAMG, and now MAMAA — or the Magnificent Seven.

This continuous process of removing companies from the category of major stock market winners and replacing them with new high-performing stocks is inherent in financial markets. Joseph Schumpeter, the renowned Austrian economist, termed this process "creative destruction," insisting it's an essential byproduct of innovation that propels an economy forward.

As creative destruction will always be with us, there will come a time when the Magnificent Seven will no longer be so magnificent, and the GRANOLAS will be forgotten. Other stocks will rise to their places, becoming the top-performing stocks of their time.