Updated: 18/11/2025•Beginners•9 min
Stocks

These stocks represent a significant portion of the tech sector and have shown remarkable growth over the years. In this article, we’ll explore what FAANG stocks are, delve into each company, discuss potential additions to the group and provide guidance on how to invest in FAANG stocks.

Investing in FAANG stocks has become a popular strategy among investors seeking exposure to some of the most influential technology companies in the world. The critical mass and influence these five stocks have attained makes considering them an obvious choice for stock investors.

What are FAANG stocks?

FAANG is an acronym that refers to five high-performing technology companies: Facebook (now Meta Platforms), Apple, Amazon, Netflix, and Google (now Alphabet). Similarities between the individual stocks has resulted in traders and investors adopting the informal term FAANG for added convenience.

Facebook, Apple, Amazon, Netflix and Google are leaders in their respective fields and have a significant impact on the wider stock market due to their large market capitalisations. A change in the price of one or a combination of FAANG stocks can influence the price of a major stock index such as the Nasdaq 100 Index (NSDQ100) because of the weighting those stocks have in that index.

Investing in FAANG stocks provides investors with exposure to companies with a proven track-record of being innovative and capitalising on consumer trends. They also continue to be at the forefront of technological advancement and have significant capital reserves which put them in a good position to exploit new technological advances such as AI.

FAANG companies explained

Each FAANG company has carved out a unique position in the tech industry, contributing to their collective dominance. Let’s take a closer look at each one:

  • Meta Platforms (META): Known for its social media platforms such as Facebook, Meta has expanded into virtual reality and the metaverse, aiming to redefine how we connect online.
  • Apple (AAPL): A leader in consumer electronics, Apple’s ecosystem of products and services, including the iPhone, Mac, and Apple Music, continues to drive its growth.
  • Amazon (AMZN): As the largest online retailer, Amazon has diversified into cloud computing, streaming services, and artificial intelligence, making it a formidable player in multiple industries. Amazon
  • Netflix (NFLX): Pioneering the streaming revolution, Netflix remains a dominant force in entertainment, continually expanding its content library and subscriber base.
  • Alphabet (GOOG): Alphabet is the parent company of market leading Google which with its search engine, advertising services, and ventures into AI and autonomous vehicles, makes Alphabet a tech giant with vast influence.

Tip: Follow FAANG stocks during earnings season and find out what crucial information their company reports reveal.

Could more companies be added to FAANG?

The tech landscape is ever-evolving, and as such, the FAANG group could potentially expand to include other influential companies. As it’s an informal categorisation, the addition of new companies is largely a personal choice, and raises the idea of FAANG becoming FAANNG.

NVIDIA Corporation (NVDA) is one contender for inclusion in the FAANG group. It is a market leader in graphics processing units (GPUs) and AI technology. Nvidia’s advancements in gaming, data centres and autonomous vehicles, as well as its growing market capitalisation, position it as a potential addition to the FAANG group.

How to invest in FAANG stocks

Investing in FAANG stocks can be done through various methods, each with its own set of advantages:

  1. Direct Investment: Purchase shares of individual FAANG companies through a brokerage account. This method allows investors to tailor their portfolio according to their preferences and risk tolerance.
  2. Smart Portfolios: eToro offers Smart Portfolios that include FAANG stocks, providing diversified exposure to the tech sector. This option is ideal for those who prefer a hands-off approach to investing.
  3. Exchange-Traded Funds (ETFs): ETFs that track the performance of tech indices often include FAANG stocks. Investing in ETFs offers diversification and is suitable for investors looking for a more balanced approach.

“Software is eating the world.”

Marc Andreessen, The Wall Street Journal

To invest in FAANG stocks, follow these steps:

  • Open an account with a reputable brokerage or investment platform like eToro.
  • Research each FAANG company to understand their business models and growth potential.
  • Decide on the investment strategy that aligns with your financial goals.
  • Monitor your investments regularly to stay informed about market trends and company performance.

Tip: As popular as FAANG stocks are, remember the importance of investing in other sectors to diversify your portfolio.

Pros and cons of investing in FAANG stocks

Investing in FAANG stocks comes with its own set of advantages and challenges. Here’s a quick overview:

Pros
  • Growth Potential: FAANG companies are leaders in innovation, offering substantial growth opportunities.
  • Market Influence: Their significant market capitalisation means they have a considerable impact on market trends.
  • Diverse Revenue Streams: Each company operates in multiple sectors, providing a buffer against industry-specific downturns.
Cons
  • Valuation Concerns: High valuations can lead to overpricing and increased volatility.
  • Regulatory Scrutiny: These companies often face regulatory challenges that can affect their operations.
  • Market Saturation: As leaders in their fields, growth may slow as markets become saturated.

Final thoughts

FAANG stocks represent a compelling investment opportunity for those looking to capitalise on the tech sector’s growth. By understanding each company’s strengths and staying informed about market developments, investors can make informed decisions that align with their financial goals.

For further insights into tech stocks visit the eToro Academy.

FAQs

What are MAMAA stocks?

MAMAA is an acronym that refers to a group of five large technology companies, Meta, Apple, Microsoft, Amazon, and Alphabet. It includes Meta, replacing the F with an M to reflect the company’s name change and also includes Microsoft (MSFT), which doesn’t appear in the FAANG group.

What percentage of the S&P 500 Index is made up of FAANG stocks?

The percentage of the S&P 500 (SPX500) Index market cap made up by FAANG stocks varies over time but during 2025 the group consistently made up approximately 20% of the SP500 Index. That figure shows how influential FAANG stocks are on the market, and how a good or bad day for FAANG stocks is often interpreted as a good or bad day for the rest of the stock market.

Why isn’t Microsoft included in the FAANG group?

The FAANG categorisation first became popular in 2010 when Microsoft was already a mature and well-established company. The members of the FAANG group have gone on to also become market titans, but at that time they were considered to have potential for higher growth rates than MSFT, and the term FAANG has traditionally been synonymous with high growth potential.

This information is for educational purposes only and should not be taken as investment advice, personal recommendation, or an offer of, or solicitation to, buy or sell any financial instruments.

This material has been prepared without regard to any particular investment objectives or financial situation and has not been prepared in accordance with the legal and regulatory requirements to promote independent research. Not all of the financial instruments and services referred to are offered by eToro and any references to past performance of a financial instrument, index, or a packaged investment product are not, and should not be taken as, a reliable indicator of future results.

eToro makes no representation and assumes no liability as to the accuracy or completeness of the content of this guide. Make sure you understand the risks involved in trading before committing any capital. Never risk more than you are prepared to lose.

Copy Trading does not amount to investment advice. The value of your investments may go up or down. Your capital is at risk. Past performance is not an indication of future results.

This communication is for information and education purposes only and should not be taken as investment advice, a personal recommendation, or an offer of, or solicitation to buy or sell, any financial instruments. This material has been prepared without taking into account any particular recipient’s investment objectives or financial situation, and has not been prepared in accordance with the legal and regulatory requirements to promote independent research. Any references to past or future performance of a financial instrument, index or a packaged investment product are not, and should not be taken as, a reliable indicator of future results. eToro makes no representation and assumes no liability as to the accuracy or completeness of the content of this publication.