The FAANG stocks – Facebook, Apple, Amazon, Netflix and Alphabet/Google – are among the most-watched tech stocks by investors, consultants and asset managers around the world. These companies’ status as household names among the investment industry and the general public and their explosive growth and upside potential have made them among the most popular stocks for investors.
Some see a FAANG bubble on the horizon. Others say the industries these companies play in – including e-commerce, cloud computing, social media and artificial intelligence – are still evolving and offer plenty of room to grow, which mean these firms have many avenues for continued growth and profits.
eVestment’s FAANG Institutional Stock Ownership Report looks at active US Large Cap (USLC) equity strategies’ ownership of these firms for Q1 2017 to offer a perspective on how the institutional investment community is reacting to these stocks and the market trends going on around them.
Few key findings are:
- Large cap growth managers decreased their portfolio weighting to Alphabet during the past quarter and year.
- Q1 USLC weight to Apple has declined for nearly seven quarters relative to the Russell 1000.
- Q1 2017 marked the lowest point, in terms of manager underweightedness, for these stocks with the exception of Facebook.
- Large cap core managers increased their exposure to FAANG stocks both quarter-over-quarter and year-over-year, with Alphabet the one exception.
- Large cap core strategies have been consistently underweight FAANG compared to the Russell 1000.
To download a full copy of the report, please click here.