The last several years have seen a tremendous rise in tech stocks. They now make up almost 25% of the S&P 500 index. Tesla, Alphabet, Facebook, Nvidia, and Apple are all within the tech sector. In fact, the information technology sector makes up more than 29% of the S&P 500. The following four stocks have impressive returns: Qualcomm, Facebook, and Apple. Here are some of their best stock picks for the coming year.
While the recent decline in big tech stocks has worried many investors, the FAANGs (Facebook, Apple, Amazon, and Google) have yet to show any signs of slowing. That’s good news for tech investors, because the FAANGs account for nearly a quarter of the market value of the S&P 500. Some have dubbed them the “Magnificent Seven” of the Nasdaq.
Uber is an example. The company has accrued enormous operating losses over the years. Moreover, management has committed some significant public relations gaffes. The recent pandemic also casts doubt on its uneven strategy. Meanwhile, its delivery division is a cash cow, and investors wonder how fast it can turn its core ride-sharing business around. The short answer is: stay away from Uber. You’ll regret it.
While technology stocks have been a risky trade since mid-November, investors are increasingly returning to the industry for safety and potential growth. Despite the volatility, investors have made money by betting on certain tech companies and sectors. For instance, some areas of the semiconductor industry exploded this year. These semiconductor processors are important for everything from crypto mining to game development. They are also essential to connect more devices. So if you’re looking for a long-term investment strategy, consider investing in these companies.
Nvidia is one of the best-performing mega-cap tech stocks of the year. Its shares surged 127% in 2021, making it the seventh largest company in the U.S. alone. Its revenue has increased more than 50% in five of the last five quarters. This is a great time to invest in Nvidia, as its high-performance graphics processing units are in high demand in the digital world.
While the automaker, energy names, and brick-and-mortar retailers have not been a winning combination over the last few years, tech stocks have been a shining light. While the tech industry has been booming in recent years, it has been a disaster for many other sectors. But, in this case, the tech giants are king. There is little doubt that this pandemic will have long-term implications for the global economy.
When looking for stocks that move the market, look at the FAANG companies. They are the biggest names in the tech sector and make up a large percentage of the S&P 500 Index. They are also some of the best companies in the tech sector. The biggest companies in this sector include Tesla, Intel, and Amazon. Those stocks are often the most popular among the other FAANG stocks. They make up about 30% of the S&P 500 Index.
Apple is another great choice in the tech sector. Although it might sound boring to some investors, Apple is a dynamic company. The iPhone’s release is a major event in the company’s calendar. Its new subscription service is a great example of a fast-growing technology stock. While it’s not a perfect investment, it’s still a winner in this market. And while the market may be slumping right now, it’s likely that some of the tech stocks you own are fading, but you can take advantage of those opportunities.
While some investors might be tempted to jump ship and exit at the bottom, the current market environment is not as rosy. While many investors will panic, tech stocks continue to remain the most attractive investments. Unlike the last couple of years, the stock market is currently in a bull market. Traders should look for the tech sector’s newest and fastest growing companies, and try to avoid the stocks that are on their way down.