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FATANG Stocks

Posted:
Topic: Technology , FATANG
Publication Type: ETP and Industry
FATANG Stocks

Have you heard of FAANG or GAFAM but aren’t sure what FATANG means? In this article, we’ll examine why some investors prefer FATANG stocks and how investors use these stocks in their portfolios. Throughout their history, FATANG stocks have weathered varied market conditions, making them a potentially attractive addition to investment portfolios. 

If you are interested in long-term or short-term investment strategies, you might consider investing in FATANG stocks. We’ll explain why these industry leaders are worthy of your consideration.

What Are FATANG Stocks?

FATANG is an acronym representing six of the largest and most popular US technology companies listed on the NASDAQ stock exchange. These stocks can all be found, with the exception of Netflix, in the top 10 holdings of the S&P 500 Index.

FATANG Stocks are:

  • Facebook: FB
  • Amazon: AMZN
  • Tesla: TSLA
  • Apple: AAPL
  • Netflix: NFLX
  • Google (Alphabet): GOOG

FATANG is very similar to another stock acronym, FAANG, which doesn’t include Tesla. The FAANG acronym was created several years before Tesla was admitted to the S&P500 index. These stocks are grouped together for their dominance in respective technology fields and phenomenal liquidity. FATANG stocks are some of the largest companies by market capitalization in the world. Accordingly, they have worldwide appeal helping to keep their trading volumes high.  

FATANG is also very similar to another stock acronym, GAFAM. GAFAM includes the U.S. technology giant Microsoft and excludes Netflix.

Facebook is a leading social media company.

Understanding FATANG Stocks

The FATANG stocks not only lead their respective sectors but because of their size, can have an outsized influence on the performance of the stock market overall. FATANG stocks have massive market capitalizations  and represent approximately 25% of the value of the entire S&P500 Index. Consequently. when FATANG stocks fall, it will likely affect the entire stock market, not just the technology sector.

Facebook

The social media corporation that defined social networking, Facebook, was created in 2004 by Mark Zuckerberg while attending Harvard University. Zuckerberg still leads the company as CEO. Facebook’s IPO was in 2012 and has a current market cap of just over $750 billion in March 2021. 

Facebook has acquired several companies since then; the most notable acquisitions were Instagram and WhatsApp.\

In 2021, Facebook has about 2.8 billion users and a revenue growth of 20%. Facebook also has a strong balance sheet and impressive cash flow. However, Facebook isn’t without controversy. It is under scrutiny for content moderationdata privacy, and antitrust investigations.

Apple

Founded by the late Steve Jobs in 1976, Apple is the first company to reach a market cap of over $2 trillion in 2020. One of the world’s leading innovators, Apple is the largest consumer electronics provider, including mobile phones, computers, cloud computing, and computer software.

Apple consistently shows revenue growth and solid earnings. In their first-quarter earnings report of 2021, Apple announced record revenue of $100 billion. Apple was added to FANG in 2017, making it FAANG.

Tesla

Founded in 2003, Tesla is an electric vehicle and clean energy corporation. Tesla’s CEO, Elon Musk, owns 22% of the shares. Tesla is a leading innovator in electric transportation, solar energy, and renewable energy solutions. 

Tesla’s market cap is 570 billion in March 2021, ranking it as one of the 10 largest companies in the S&P500. Tesla was the largest stock to be added to the S&P 500 Index and ranks in top 5 largest companies in the NASDAQ 100. 

Amazon

A multinational tech corporation, Amazon’s predominant services include e-commerce, distribution, and digital streaming. Of all the companies on FATANG, Amazon is one of the few companies that leads in multiple industries. Created in 1996 by Jeff Bezos, Amazon is the world’s largest online retailer.

Amazon owns 47% of the US e-commerce market with over 100 million Amazon Prime members, where one in three Americans has a Prime membership. In 2020, Amazon reported $386 billion in net sales and a net income of $21.3 billion.

Netflix is the smallest company in FATANG

Netflix

Created in 1997, Netflix is a leading tech and media services provider and the world’s most popular streaming service. It has a market cap of about $228 billion as of March 2021 and is the 36th most valuable company globally. 

While Netflix’s market cap is significantly smaller than other FATANG stocks, it’s popular among investors because of its dramatic growth in the last five years. Netflix is 21st on the S&P 500 and reported a record year in 2020 with annual revenue of $25 billion and over 200 million memberships. They also grew their operating profit by 76% to $4.6 billion.

Google (Alphabet)

Restructured in 2015 under the parent company Alphabet, Google is the largest internet search engine, claiming 92% of the internet’s search volume.

Alphabet is split into two share classes, GOOG and GOOGL, as a way to preserve the founders voting power.. Alphabet has a market cap of 1.4 trillion as of March 2021.

FATANG

GraniteShares FATANG ETPs provide exposure to the equal weight to following companies: Facebook, Amazon, Tesla, Apple, Netflix and Alphabet

Product Offerings

FATANG vs. FAANG

FATANG stocks primarily consist of four of the top tech corporations with the addition of Netflix and Tesla. These companies are some of the most valuable businesses in the US. They are seen as global leaders and influencers.

 

FATANG has a joint market cap of approximately $6.5 trillion as of March 2021. 

Why FAANG Added Tesla

Tesla has been a popular stock with investors for many reasons, including its stock price performance and its huge army of loyal fans who support the company on online investing forums. Within the FATANG group, Tesla’s trading volume ranks second overall, behind Apple.  

 

Tesla ranks second in options open interest behind Apple which can also be an indicator of a stocks popularity.

 

How to Invest in FATANG Stocks

Until very recently, investors were mostly limited to trading stocks or options on individual FATANG stocks. Investors looking for broader exposure were limited to strategies such as technology ETFs or index funds that included exposure to many more companies than just FATANG.

If you’re interested in FATANG exchange-traded products (ETPs), only one company offers a range of products on FAANG, GAFAM and FATANG stocks. Graniteshares ETPs are “pure play” investments, meaning that they are not diluted with unrelated stocks. Graniteshares ETPs follow equally weighted indexes that rebalance quarterly. Graniteshares family of ETPs allows investors to go long or short the FAANG indices or even 3x leveraged.

Product Name Ticker Leverage Factor
GraniteShares FAANG ETP FANG  
GraniteShares 1x Short FAANG Daily ETP SFNG -1x
GraniteShares 3x Long FAANG Daily ETP 3FNG +3x
GraniteShares 3x Short FAANG Daily ETP 3SFG -3x
GraniteShares GAFAM ETP GFAM  
GraniteShares 1x Short GAFAM Daily ETP SGFM -1x
GraniteShares 3x Long GAFAM Daily ETP 3GFM +3x
GraniteShares 3x Short GAFAM Daily ETP 3SGF -3x
GraniteShares FATANG ETP FTNG  
GraniteShares 1x Short FATANG Daily ETP SFTG -1x
GraniteShares 3x Long FATANG Daily ETP 3FTG +3x
GraniteShares 3x Short FATANG Daily ETP 3SFT -3x

 

 DISCLAIMER

This is a disclaimer stating that all trading and investing comes with risks. Always do your research and do not invest more than you can afford to spend.

GraniteShares accepts no responsibility for any loss or damage resulting directly or indirectly from the use of this blog or the contents. GraniteShares Limited (“GraniteShares”) (FRN: 798443) is an appointed representative of Duff & Phelps Securities Ltd. (FRN: 466588) which is authorised and regulated by the Financial Conduct Authority.

This blog does not constitute an offer to buy or sell or a solicitation of an offer to buy securities in any company. Nothing contained herein constitutes investment, legal, tax or other advice nor is to be relied upon in making an investment or other decision. No recommendation is made positive or otherwise, regarding individual securities or investments mentioned herein. Any summary list of risk factors does not purport to be a complete enumeration or explanation of the risks involved in a particular investment. Prospective clients must consult with their own legal, tax and financial advisers before deciding to invest. This email contains the opinions of the author and such opinions are subject to change without notice. The source of data is GraniteShares unless otherwise stated. No guarantee is made to the accuracy of the information provided which has been obtained from sources believed to be reliable. This email and the information contained herein is intended only for the use of persons (or entities they represent) to whom it has been provided. Past performance is not a reliable indicator of future results.  The value of an investment may go down as well as up and can result in losses, up to and including a total loss of the amount initially invested. Investments may involve numerous risks including, among others, company risks, general market risks, credit risks, foreign exchange risks, interest rate risks, geopolitical risks and liquidity risks.  Please note that GraniteShares short and leveraged Exchange Traded Products are for sophisticated investors.

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