BAJAJ BROKING
March 24, 2025
8 mins read
Indian investors looking to start investing in US stocks often come across the word ‘FAANG’. FAANG stocks refer to five of the most influential and well-established technology companies in the U.S. stock market: Facebook (now Meta), Apple, Amazon, Netflix, and Google(now Alphabet). These companies have gained global prominence due to their innovation, vast market capitalization, and strong financial performance. FAANG stocks, while primarily influencing U.S. markets, also impact Indian indices like the BSE Sensex and Nifty 50 through global investment flows, sectoral trends, and the performance of Indian IT firms that have business ties with these tech giants.
FAANG refers to five major American technology companies: Meta Platforms (formerly Facebook), Amazon, Apple, Netflix, and Alphabet (formerly Google). These companies are widely recognized for their substantial influence in the technology sector and their strong market capitalizations. Their consistent innovation, dominance in their respective industries, and global reach have made them key players in financial markets, attracting investors worldwide. Over the years, their growth has reshaped the digital economy, driving advancements in artificial intelligence, cloud computing, e-commerce, and digital entertainment.
The term "FAANG" originated as "FANG" when CNBC's Jim Cramer coined it in 2013 to highlight four standout tech stocks: Facebook, Amazon, Netflix, and Google. At that time, Apple was not included in the grouping. However, as Apple’s market influence grew significantly, it was later added to the acronym, forming what is now known as FAANG. These companies have since played a crucial role in shaping the technology landscape and stock market trends. As of March 2025, the combined market capitalization of FAANG companies is estimated to be around $9.3 trillion accounting for roughly 17% of the U.S. stock market’s total valuation of $57 trillion. These figures reflect their continued dominance and importance in the stock market. Their price movements significantly impact market indices, influencing the portfolios of institutional and retail investors alike.
Here’s a rundown of the FAANG companies:
Company | Industry | Stock Symbol | Market Cap (Approx.)* |
Meta (Facebook) | Social Media & AI | META | $1.6 trillion |
Apple | Consumer Electronics | AAPL | $3.3 trillion |
Amazon | E-commerce & Cloud | AMZN | $2.1 trillion |
Netflix | Streaming Services | NFLX | $393.3 billion |
Alphabet (Google) | Search & Cloud Computing | GOOGL | $2.0 trillion |
*Note: Market capitalisation as on March 13th 2025.
Founded in 2004 by Mark Zuckerberg, Meta Platforms revolutionized social networking with Facebook, connecting billions globally. Over time, Meta expanded its portfolio by acquiring Instagram and WhatsApp, becoming a dominant force in social media. In 2021, the company rebranded as Meta to emphasize its focus on building the metaverse, a virtual reality space where users can interact in immersive environments. This strategic shift aims to position Meta at the forefront of next-generation digital experiences, reflecting its commitment to innovation and adaptation in the ever-evolving tech landscape. As of early 2025, Facebook, its flagship platform, boasts approximately 3.06 billion monthly active users, maintaining its status as the world's most utilized social media platform.
Founded by Jeff Bezos in 1994 as an online bookstore, Amazon has transformed into a global technology conglomerate, leading in e-commerce, cloud computing, and digital streaming. In 2024, the company reported net sales of $638 billion, marking an 11% increase from the previous year. Amazon Web Services (AWS), its cloud computing division, contributed $107.6 billion to these sales, reflecting a 19% year-over-year growth. Amazon Prime, the company's subscription service, boasts over 200 million members worldwide, offering benefits like expedited shipping and access to streaming services. Through strategic acquisitions and continuous innovation, Amazon maintains its position as a leader in various industries, shaping the future of retail and technology.
Founded in 1976 by Steve Jobs, Steve Wozniak, and Ronald Wayne, Apple has grown into a leading multinational technology company renowned for its innovative consumer electronics, software, and online services. In fiscal year 2024, Apple reported revenues of $391 billion, maintaining its status as the world's largest technology company by revenue. The company employs approximately 164,000 full-time employees as of 2024, reflecting its expansive global operations. Apple's product ecosystem—including the iPhone, iPad, Mac, Apple Watch, and services like the App Store and Apple Music—continues to drive consumer loyalty and substantial financial performance. The company's commitment to innovation is further underscored by its recent investments in artificial intelligence and plans to expand manufacturing capabilities within the United States.
Established in 1997, Netflix has evolved from a DVD rental service into a leading subscription-based streaming platform, offering a vast library of films and TV shows. As of January 2025, Netflix boasts over 300 million paid subscribers globally, marking a significant increase from previous years. The company's strategic expansion into live event programming, including high-profile sports events like NFL games, has contributed to its substantial subscriber growth. In the fourth quarter of 2024, Netflix added 18.9 million new subscribers, surpassing analysts' expectations and reflecting its robust market presence. Operating in over 190 countries, Netflix continues to invest in original content, enhancing its appeal to a diverse global audience.
Founded in 1998 by Larry Page and Sergey Brin, Google has grown from a search engine into a global technology leader, offering a wide array of internet-based services and products. The company's core product, Google Search, dominates the U.S. market, processing over 90% of search queries. Beyond search, Google has developed services such as Gmail for email, Google Docs and Sheets for productivity, and YouTube for video sharing. The Android operating system, developed by Google, powers approximately 70% of the world's smartphones. In 2015, Google restructured under the parent company Alphabet Inc., allowing for greater focus on its diverse ventures, including advancements in artificial intelligence and cloud computing.
FAANG stocks—comprising Meta Platforms (formerly Facebook), Amazon, Apple, Netflix, and Alphabet (formerly Google)—are highly sought after due to their market dominance, consistent growth, and technological innovation. These companies hold significant shares in their respective industries, driving revenue through diversified business models in social media, e-commerce, consumer electronics, streaming services, and search engines. Their ability to adapt to evolving market trends and expand into emerging technologies enhances their attractiveness to investors seeking robust returns.
Beyond their innovation and industry leadership, FAANG stocks have historically outperformed traditional indices, such as the BSE Sensex and Nifty 50, making them ideal for long-term wealth creation. Notably, these five companies collectively account for approximately 15% of the S&P 500 and 30% of the Nasdaq-100 Index, underscoring their substantial impact on the overall market. Their strong financial performance, global influence, and ability to reshape consumer behavior have solidified their status as some of the most influential and valuable companies in the world. Investors are drawn to these stocks for their resilience, consistent revenue streams, and potential for sustained growth, reinforcing their significance in global market.
While Indian investors can invest in the US stock market indirectly through mutual funds and ETFs, to acquire FAANG stocks, they have to open a Demat account and overseas trading account online.
Here’s why investing in US stocks, particularly FAANG stocks is beneficial:
Strong fundamentals
FAANG companies have some of the strongest financials in the stock market, boasting high revenues, consistent profitability, and robust balance sheets. Their ability to generate substantial cash flow allows them to reinvest in innovation, expand their market dominance, and sustain long-term growth. These factors make FAANG stocks more resilient during economic downturns and market fluctuations, ensuring stability for investors.
Consistent dividend payouts
While most FAANG companies focus on reinvesting profits, some, like Apple, provide regular dividend payouts. This offers an additional income stream for long-term investors looking for steady cash flow. Dividend-paying FAANG stocks allow investors to benefit not just from capital appreciation but also from periodic earnings, making them attractive for wealth accumulation strategies.
Diversification
Investing in FAANG stocks provides exposure to multiple high-growth industries. Since these companies operate in diverse sectors, they help reduce portfolio risk by spreading investments across different revenue streams. This broad industry footprint ensures that investors benefit from various technological advancements and market trends.
Resilience and stability
FAANG stocks are known for their large market capitalization and global influence, making them relatively stable even in volatile market conditions. Their strong brand value, extensive consumer base, and ability to innovate give them an edge in maintaining steady growth. During economic downturns, FAANG companies often demonstrate resilience, as their products and services remain essential in the digital economy, further enhancing their appeal to investors.
FAANG refers to five major technology companies: Facebook (now Meta), Amazon, Apple, Netflix, and Google (now Alphabet). Coined by CNBC's Jim Cramer in 2013, FAANG represented the most dominant and high-performing tech stocks in the U.S. market. However, as the industry evolved, a new acronym, MAMAA, was introduced to better reflect the sector’s current leaders. MAMAA includes Meta, Apple, Microsoft, Amazon, and Alphabet, replacing Netflix with Microsoft.
This shift acknowledges Microsoft’s growing dominance in cloud computing, AI, and enterprise solutions, making it more influential than Netflix, whose market position has become more sector-specific. Additionally, Facebook rebranded as Meta in 2021 to align with its focus on the metaverse, while Google had already restructured under Alphabet in 2015 to reflect its broader business operations. These changes signify the evolving nature of the tech sector, where market influence and industry leadership continuously shift based on innovation, financial strength, and strategic direction.
FAANG stocks have remained a dominant force in the global stock market, driven by their innovation, strong financial performance, and industry leadership. Their influence extends beyond the U.S., impacting markets worldwide, including India. Investors looking to capitalize on the growth of these tech giants can do so by participating in the U.S. stock market. Indian investors can partake in the growth and potential of FAANG stocks by opening a Demat account and an overseas trading account online, enabling seamless access to international equities. With advancements in financial technology, investing in global markets has become more convenient, allowing Indian investors to diversify their portfolios and capitalize on the opportunities presented by these tech giants.
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FAANG represents five major U.S. technology companies: Facebook (Meta), Apple, Amazon, Netflix, and Google (Alphabet). MAANG is a newer variation of the acronym after Facebook rebranded to Meta, but both terms refer to the same group of influential tech stocks.
FAANG stands for Facebook (now Meta), Apple, Amazon, Netflix, and Google (Alphabet). These companies are leaders in their respective industries and have significant market influence in the technology sector.
No, Microsoft is not part of FAANG. However, it is included in MAMAA (Meta, Apple, Microsoft, Amazon, Alphabet), a more recent term recognizing Microsoft’s dominance in cloud computing, AI, and enterprise software.
Among FAANG stocks, Apple is known for providing dividends, making it attractive for income-seeking investors. Other FAANG companies focus on growth, reinvesting earnings into business expansion rather than issuing dividends.
FAANG stocks have historically traded at premium valuations due to their strong growth potential. While some analysts consider them overvalued, their market dominance, innovation, and consistent revenue generation make them attractive for long-term investors.
No, FAANG stocks can be easily purchased through an overseas trading account online. Investors can also buy fractional shares of these stocks as well. However, fractional trading and margin trading facility (MTF) is not available to Indian investors.
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