FAANG Stocks

FAANG refers to five of the most iconic technology companies in the United States: Facebook (now Meta), Amazon, Apple, Netflix, and Google (now Alphabet). These firms have transformed the digital world with innovations, and people like them for their consistent growth, innovation, and strong impact on global tech trends, making them a popular choice to invest in US stocks.

FAANG stocks have historically delivered strong, consistent returns. As of 2025, this group has evolved into a broader and more relevant collective known as MAMAA which comprises Microsoft, Apple, Meta, Amazon, and Alphabet. These companies have a combined market capitalization of over $12 trillion, representing around 20% of the total US market cap.

What are FAANG stocks?

The term “FAANG” traces back to CNBC’s Jim Cramer, who coined it as “FANG” to highlight Facebook, Amazon, Netflix, and Google as market outperformers. As Apple’s market influence surged, it was added to form the full FAANG acronym. These companies have redefined user behavior, digital engagement, and global commerce.

How FAANG became MAMAA

The evolution from FAANG to MAMAA occurred as Microsoft gained substantial ground in cloud infrastructure, AI, and enterprise solutions. Alphabet, having diversified well beyond its Google roots, now has a huge presence in multiple high-growth segments. Netflix, while still a key digital player, is no longer grouped with the others due to relatively slower growth and narrower business lines compared to Microsoft.

MAMAA now reflects the reality of the five most influential and capital-heavy tech companies in the U.S. markets. Together, they drive nearly a quarter of the S&P 500’s total market capitalization and are core holdings for nearly every major institutional portfolio. 

How to invest in FAANG via INDmoney

With INDmoney, Indian investors can directly access U.S. equities, including FAANG and MAMAA stocks, through a simple, regulated process. INDmoney provides seamless KYC, swift fund transfers under RBI's Liberalized Remittance Scheme (LRS), and zero brokerage on U.S. stock trades.

Here’s how you can invest in FAANG stocks through INDmoney

Step 1: Complete your KYC on the INDmoney app
Step 2: Transfer funds to your U.S. stocks account under LRS
Step 3: Choose your preferred FAANG or MAMAA stocks and start investing, fractionally or in full

You don’t even need large capital to begin investing in these megacap stocks. With fractional investing, you can own a piece of Apple or Amazon starting from just Rs 100.

What makes FAANG stocks so popular?

FAANG stocks have become household names and represent products and platforms used daily by billions. Whether it is shopping on Amazon, streaming on Netflix, socializing on Facebook, searching via Google, or using an iPhone, these companies have reshaped how people live, work, and interact.

Investors favor them because of their strong historical returns, consistent earnings growth, and ability to innovate in highly competitive markets. They serve as both growth drivers and relatively stable anchors in equity portfolios.

Advantages of investing in FAANG stocks

• Strong historical performance: Many FAANG stocks have delivered average annual returns above 15 percent over the past decade.
• Long-Term compounders: Their financial stability, recurring revenues, and scalability make them ideal for compounding long-term wealth.
• Leadership in growth sectors: FAANG lead in industries expected to expand sharply this decade, such as AI, cloud computing, and mobile tech, 
• Market leadership: Each FAANG company dominates its vertical, offering exposure to category-defining platforms and services.
• Global influence: FAANG companies’ products reach billions across the globe, helping spread geographic and currency-related risks.
• Crisis resilience: Strong cash reserves and investment pipelines allow FAANG to innovate and grow even in downturns.

Risks or limitations of investing in FAANG stocks

• Valuation sensitivity: Their high valuations can amplify downside risk when investor sentiment shifts or earnings miss expectations.
• Price volatility: These stocks often swing sharply during earnings seasons or macroeconomic events, impacting short-term returns.
• Regulatory headwinds: Increasing scrutiny over privacy, competition, and taxation could limit growth or alter business models.
• Legal complexity: Operating across jurisdictions brings exposure to compliance risks and evolving international laws.
• Concentration risk: Heavy allocation to a few dominant names could reduce diversification in a tech-heavy portfolio.
• High prices: Valuations are often steep, so any earnings miss or macro concern could trigger a sharp stock correction making investors lose money.

The Magnificent Seven: A broader context

In market discussions today, MAMAA companies are often included in the “Magnificent Seven” group, which also comprises Nvidia and Tesla. These seven companies together drove more than 70% of the S&P 500's gains in 2024, underscoring their pivotal role in US market performance. Nvidia’s surge was powered by AI chip demand, while Tesla capitalized on energy storage and software-led vehicle innovations.