At the beginning of this past summer, several Goldman Sachs strategists predicted a bubble in the technology industry. Specifically, they predicted a bubble in FANG stocks. FANG is just a term that refers to Facebook, Apple, Amazon, Netflix, and Alphabet (Google). However, since June 15th and as of September 15th, with the exception of Alphabet, all FANG stocks have had a positive growth, with shares of Netflix jumping more than 20 percent. But the assumption of a bubble still lies, as some have compared FANG stocks to the dot-com bubble in the 1990s.
The short interest on FANG stocks is currently at approximately 2%, an all-time low.
Currently, the stock market is at a historically high rate. This is mainly due to the low-interest rates the Federal Reserve put in place and the weakness of the dollar. But the future for all stocks, especially FANG stocks and the technology sector in general, is not immediately evident.
All of the FANG stocks have been known to use methods of marketing personalized to their customers. For example, Amazon’s tracking of search results and crafting personalized predictions of what customers would like to buy. Netflix and Facebook have also used personalized recommendations for television shows and movies, or Facebook pages and posts, respectively. As for Apple, the stock faced a decline after the new FaceID technology malfunctioned after it’s release. However, Apple has always been a steady stock with consistent growth and it is not worth passing up at this point.
With future advances in technology, more and more data is capable of being stored. This is a factor which will clearly affect FANG stocks and the tech sector positively. As for now, the FANG stocks show no imminent sign of being in a bubble and they are all strong buys.