Please register to participate in our discussions with 2 million other members - it's free and quick! Some forums can only be seen by registered members. After you create your account, you'll be able to customize options and access all our 15,000 new posts/day with fewer ads.
Met a friend tonight and got talking about investing... the guy started talking about how FANG was some kind of mana from heaven, FANG is the future, FANG is going to skyrocket from here, FANG is just getting started, FANG will be way up, a sure bet and you cannot lose so pickup some when you can, FANG is going to grow like crazy etc. etc.
I am a bit skeptical about the whole thing, isn't AMZN trading at some ridiculous P/E? So, this is on speculative earnings? What are your thoughts on the trajectory of FANG from here? Surely nothing can be such a risk free bet... that just sounds too good to be true or perhaps just too naive to believe something like that.
Nothing wrong with owning FANG, I’d actually encourage it, but your friend is foolish if he truly believes there is nothing to lose. It’s still mid-level risk in my opinion.
The risk here is earnings expectations are so high that any slip up is severely punished . These companies have the pressure on them to not just do well at these prices but they have to exceed the expectatioons of the great performance already built in.
I am still positive on Facebook even though the stock has stalled around 180....
Interesting side note... I saw recently that someone was proposing renaming the FANG group of stocks to TANG to account for Twitter's recent doubling in price. Maybe the Twitter people have figured it out......
I still think Facebook is the best of these 4 FANG stocks....
Wouldn't touch Amazon --- they seem to be starting to di-worsify (to quote Peter Lynch) into businesses they don't know how to run. Netflix - no comment, kudo's to anyone who got in a few years ago. Google - probably tracks overall market at this stage.
The risk here is earnings expectations are so high that any slip up is severely punished . These companies have the pressure on them to not just do well at these prices but they have to exceed the expectatioons of the great performance already built in.
Fang may be a prime example of the flaws of passive/index investing. People buying broad market index funds are buying them because of size and not necessarily future earnings.
I like FAANG. However they are not the risk free bet that your friend says or intimates that they are. Be careful if you chose to hold them, especially all of them at one time.
FAANG has been around several years. It is this market's incarnation of the fab five. The 1990's version had Qualcomm, Lucent, Applied Materials, Microsoft, and Texas Instruments or Intel. The top five Nasdaq-100 stocks had 40 percent of the Nasdaq market capitalization. There is an ETF built around buying the 20 momentum leaders in the current market, just as there were the Marisco Focus and Janus Twenty funds in the late 90's. Things may be changing as the fund dropped 1.5 times the SPX in the latest decline. Up until now, it's been a darling because of the low beta. Low volatility funds, not to be confused with short volatility funds, have been the sure bets for the last several years.
Fang may be a prime example of the flaws of passive/index investing. People buying broad market index funds are buying them because of size and not necessarily future earnings.
Can you explain a bit? I'm not sure I follow.
Please register to post and access all features of our very popular forum. It is free and quick. Over $68,000 in prizes has already been given out to active posters on our forum. Additional giveaways are planned.
Detailed information about all U.S. cities, counties, and zip codes on our site: City-data.com.
Please register to participate in our discussions with 2 million other members - it's free and quick! Some forums can only be seen by registered members. After you create your account, you'll be able to customize options and access all our 15,000 new posts/day with fewer ads.
