What are FANG Stocks?
FANG is an acronym for four technology stocks listed on the NASDAQ exchange. It includes Facebook, Amazon, Netflix, and Google (now Alphabet Inc.).
FANG Stock Performance
As of August 10, 2017, the NASDAQ 100 and S&P 500 were up 19% and 8.9% year-to-date, respectively. Each FANG stock was up more than two times that of the S&P 500 – Facebook was up 45%, Amazon 27%, Netflix 36%, and Google 16%.
How FANG Stocks Affect Market Performance
As of August, 10th, 2017, within the S&P 500 index, Facebook, Amazon, Netflix, and Google were ranked 4th, 3rd, 67th, an 9th (and 10th) based on size, respectively. Google has two ranks because the company currently offers two share classes on public exchanges (GOOG and GOOGL). Since the S&P 500 index is weighted based on market capitalization, the performance of these four large companies has a significant impact on the performance of the market as a whole. This is important for investors that choose to mirror the market index. These investors risk being overexposed to the technology sector and must be cautious when their portfolios begin to heavily favours FANG equities.