What Are FAANG Stocks? Should You Invest in NYSE FANG Index from India?
Facebook, Amazon.com, Apple, Netflix Inc, and Alphabet are the five companies that make up the FAANG acronym. If you're an investor, knowing the big companies that drive the overall stock market's success is beneficial. The software, communication services, and consumer discretionary industries, as reflected by FAANG stocks, have outperformed the broader market significantly over the last year. The NASDAQ Stock Market is where all of the stocks are traded. The FAANG stocks are also included in the S&P 500 Index, which features the 500 largest publicly traded firms by market capitalization that are traded on the NYSE or NASDAQ. FAANG stock price volatility affects the entire market, including investors who do not hold FAANG stocks.
FAANG Stocks
Facebook (FB) is the most popular online social networking and social media platform. Amazon.com (AMZN) dominates the e-commerce and cloud computing technology industries. In the streaming video on demand market, Netflix (NFLX) has a massive lead. Google (GOOGL) of Alphabet (GOOGL) is the king of internet search. Apple is no less than other companies which joined the list recently.
FANG stocks are famous for the impressive growth they have shown in recent years, with each member more than doubling over the past five years. However, despite exhibiting growth stock behavior, FANG stocks are not too volatile. It's this stability, along with delivering superior rates of return, that has made these quite attractive to investors.
FAANG Stocks Growth Over Years
Since each FAANG company is listed on the New York Stock Exchange (NYSE) or the NASDAQ, most investors would find buying shares of each company to be a simple process. FAANG stocks account for about 15% of the S&P 500. Although the S&P 500 has increased by 18% since June 2020, FAANG stocks have increased by 19% to 31% over the same period.
| Growth in Dollars | 2012 | 2016 | 2020 |
| Facebook (FB) | 38.23 | 119.49 | 279.70 |
| Amazon (AMZN) | 212.89 | 673.95 | 3,162.58 |
| Apple (AAPL) | 18.94 | 23.81 | 122.25 |
| Netflix (NFLX) | 11.05 | 87.88 | 498.31 |
| Google (GOOGL) | 300.20 | 725.18 | 1,823.76 |
How to Invest in FANG Stocks?
Investors can invest in following ways:
1) Invest in FANGS through Indian Brokerages
2) Invest in FANGS through Foreign Brokerages
3) Invest in FANGS through Investment Platforms like Paytm, Cube wealth.
What is an NYSE FANG+ Index?
Over the past seven calendar years, the NYSE FANG+ Index has outperformed the S&P500, NASDAQ 100, and Nifty50 on a risk-adjusted and absolute return basis. With a cumulative market cap of $7.7 trillion as of February 2021, the NYSE FANG+ Index now includes ten of the world's most heavily traded, next-generation tech companies that have shaped and continue to shape our future.
NYSE FANG+ Index Constituents of the following companies:
- Facebook (FB)
- Amazon (AMZN)
- Apple (APPL)
- Netflix (NFLX)
- Google (GOOGL)
- Tesla's (TSLA)
- Twitter's (TWTR)
- NVIDIA (NVDA)
- Alibaba's (BABA)
- Baidu (BIDU)
Should You Invest in NYSE FANG Index?
Investing in FAANG stocks can make sense, but you should weigh the pros and cons before making a purchase. To see if the stock is still worth investing in, compare its value to that of its rivals. Examine your own investment portfolio to ensure that it reflects your own investment objectives and principles. The competitive advantages, according to analysts, make FAANG stocks excellent potential investments. Furthermore, each of these five businesses has intangible assets that enable them to outperform their rivals in terms of profitability.
If you can't afford FAANG stocks or don't want to buy individual shares, you can get exposure to them through a variety of mutual funds and exchange-traded funds (ETFs).