Table of contents
- What are FAANG stocks?
- FAANG Stocks: How did it get its name?
- What makes FAANG stocks so popular among global investors?
- How did FAANG stocks get their momentum and growth?
- What are the FAANG companies?
- Are the FAANG stocks tricky to acquire?
- How to diversify the FAANG stocks portfolio?
- Are FAANG stocks still a lucrative investment?
- FAQs
What are FAANG stocks?
In the language of finance, FAANG‘s full form stands for the Five Distinctive American Technology Enterprises. They include Facebook (now known as Meta), Amazon, Apple, Netflix and Google (now known as Alphabet). Each of these tech giants makes for an astonishing market in the stock industry. Hence, they make investors look forward to investing in the best international players.
FAANG Stocks: How did it get its name?
Jim Cramer, the celebrated television host of the CNBC show “Mad Money”, coined the term FAANG in 2013. However, he used the term FANG. The 2nd “A” in its acronym, which came from Apple, was added in 2017. FAANG has now been dubbed MAMAA (Meta, Apple, Microsoft, Amazon, and Alphabet), as two members have changed their names, and one has been replaced.
What makes FAANG stocks so popular among global investors?
The five stocks of FAANG are hugely popular among investors worldwide. With a combination of markets of the biggest companies, it has a market capitalization of about 7 trillion USD in 2022.
FAANG has caught the likes of Soros Fund Management, Berkshire Hathaway or BRK, as well as Renaissance Technologies. These are just a few of the biggest names that have added the stocks of FAANG to their business portfolios.
How did FAANG stocks get their momentum and growth?
Each of the stocks FAANG trades on the prestigious National Association of Securities Dealers Automated Questions Stock Exchange, or the NASDAQ exchange. Also, each stock has its place in the S&P 500 index.
What are the FAANG companies?
Here are the details of the FAANG stocks:
- Meta or Facebook: This well-known social networking platform is Mark Zuckerberg’s brainchild. With over 2.8 billion users now, it controls WhatsApp, Oculus VR, and Instagram.
- Amazon: In 1994, Jeff Bezos started it as an online bookshop. Rapidly, it expanded to be the leading e-commerce platform in the world. Operating almost worldwide, Amazon now offers everything from electronics to groceries.
- Apple: Back in 1976, Steve Jobs, Steve Wozniak, and Ronald Wayne founded an electronics company named Apple. Now, with hardware like the iPhone and iPad, as well as Mac laptops and software, it has a valuation of 2 trillion USD.
- Netflix: This online streaming platform has revolutionised the world of entertainment. Created by Marc Randolph and Reed Hastings in 1997, Netflix is now an entertainment giant with a very prominent global presence. It presently has more than 200 million subscribers all over the world.
- Google (Alphabet): The enterprise was founded by Sergey Bill and Larry Page in 1998 and reconstructed as Alphabet in 2015. It is the mother company of Google and its subsidiaries, such as Google Drive, Gmail, and the like.
| FAANG Stocks(2023) | USER | Revenue | Net Income |
| Meta(META or Facebook) | 3.74 Billion | $116.61 Billion | $39.4 Billion |
| Amazon(AMZN) | 300 Million | $524.897 Billion | $33.4 Billion |
| Apple( AAPL) | 1.5 Billion | $285.095 Billion | $28 Billion |
| Netflix(NFLX) | 232.5 Million | $31.909 Billion | $4.200 Billion |
| Google(GOOG) | 4.3 Billion | $279.8 Billion | $ 58.587 Billion |
Are the FAANG stocks tricky to acquire?
All of the FAANG Companies are meant for public trade. This is the reason why there is nothing complicated about acquiring FAANG stocks. Despite the volatile market, each company enjoys a substantial volume of daily trades.
How to diversify the FAANG stocks portfolio?
Despite all the positive market forecasts, anyone willing to invest in the FAANG Companies might consider diversifying their portfolio. Some of the stocks in FAANG can give impressive returns for the time being.
Are FAANG stocks still a lucrative investment?
As an investor, you need to understand that the fluctuations you see in MAMAA or FAANG Companies are the new “normal”. No matter what the experts argue, there are certain pointers that you cannot deny. Amidst inflation and a series of unfavourable circumstances for investment, these big-cap stocks are offering deep and rare discounts.
With Meta’s all-time high of 63% off and Amazon’s trading at 47%, the trading is significantly low compared to the historical average valuation. And even after such sharp price cuts, these FAANG companies contain 17.4% of the S&P 500.
So it is only prudent to observe these names. Investments in these companies can yield some truly lucrative returns.
FAQs
Facecook’s ticker changed to Meta in June 2022, at which point FAANG (Facebook, Apple, Amazon, Netflix, and Google) became MAANG. MAANG is an acronym for Meta (formerly Facebook), Apple, Amazon, Netflix, and Google. In short, FANG became FAANG and then MAANG.
Nvidia’s AI growth is climbing the tech ladder and making it a must-own stock. The FAANG (Facebook, Apple, Netflix, Amazon, and Alphabet) buzz of the past has given way to MATANA (Microsoft, Apple, Tesla, Alphabet, Nvidia, and Amazon). It is expected that investments in AI will reach a peak.
In terms of market cap, Apple has always been in the lead. Apple’s market worth is $2.4 trillion, according to recent figures. However, revenue is also important. Although Apple may be the leader in terms of sales and market capitalization, Google’s massive user base cannot be overlooked.
There has been a lot of attention from stock market experts on “The Magnificent Seven.” These are Apple, Microsoft, Alphabet, Amazon.com, Nvidia, Tesla, and Meta Platforms, ranked by market capitalization. In 2023, the average return for the top seven S&P 500 companies was 92%.