<!-- Swiftype Variables -->

White Papers

Don’t let the FANGs bite you

The superstar FANG stocks — Facebook, Amazon, Netflix and Alphabet's Google — still grab a lot of headlines, but investors might be better served ignoring them and focusing on more boring sectors of the market, such as autos, tech hardware and semiconductors.

Olivia Engel, senior managing director and CIO of active quantitative equity at State Street Global Advisors, says that based on the firm's proprietary multi-factor model FANG stocks are still expensive and risky compared with many other sectors and stocks.

And don't bother expanding the universe of superstar tech stocks to include Microsoft, Apple, Nvidia, Twitter and Tesla — or their emerging-market equivalents the BATs: Baidu, Alibaba and Tencent — because Engel says that group, on average, continues to be expensive, high risk and of lower quality compared with the rest of the equity universe.

So rather than focusing on the FANGs and BATs that are attracting all the attention – consider the boring ones. As mathematician and physicist Freeman Dyson once said, “Nothing is boring if you look at it carefully.”

  view more white papers

By downloading a white paper, you are agreeing to have your contact information shared with the content sponsor, who may then contact you.

All white papers posted were created by the listed authors who are solely responsible for the research, finding and all materials contained therein. Pensions & Investments has not verified or edited the materials (other than for length and style) and does not necessarily agree or disagree with the analysis and positions expressed by the authors. Reference to any company, product or service does not imply recommendation or sponsorship by Pensions & Investments.

For more information on submitting a white paper, please contact Richard Scanlon at rscanlon@pionline.com or 212-210-0157.