what are gafam stocks 
gafam is an acronym for five popular u s tech stocks google alphabet apple facebook meta amazon and microsoft gafam is quite close to but nonetheless different than the more popular faang acronym which collectively indicates u s technology stocks facebook apple amazon netflix and google in the latter netflix takes the place of microsoft understanding gafam stockswhile a lot of market indexes exist to collectively track the developments of a sector there are a handful of companies that lead the pack in terms of sector influence faang gafam and batx are acronyms for influential companies that have a large impact on their sectors and the market as a whole gafam is made up of alphabet inc goog apple inc aapl meta meta formerly facebook amazon com inc amzn and microsoft corp msft all five companies are listed on the nasdaq stock exchange gafam versus faangamong the commonly used faang group of companies netflix is the only one belonging to the consumer services sector and consumer electronics video chains sub sector owing to its media content business while the other four belong to the technology sector the term gafam was coined to replace netflix with microsoft in the list making it a group of more technology focused companies while amazon is also classified under the consumer services sector and catalog specialty distribution subsector it also has its cloud hosting business and amazon web services aws which make it a significant contributor to the technology space essentially gafam represents the u s s technology leaders whose products span mobile and desktop systems hosting services online operations and software products the five gafam companies have a joint market capitalization of around 4 5 trillion and are all within the top 10 companies in the us according to market capitalization as of march 31 2020 among gafam stocks the oldest company to list on the stock exchange is apple which had its initial public offering ipo in 1980 followed by microsoft in 1986 amazon in 1997 google in 2004 and facebook in 2012 example how gafam is used in the real worldalphabet apple meta amazon and microsoft are big players in the technology space many investors believe that if these stocks are doing well the entire sector likely is as well in a way these stocks act like an index for the technology sector heading into early 2020 the nasdaq 100 index was rising gafam stocks were also rising meta was the first one to break lower peaking in late january 2020 the other gafam stocks and the nasdaq 100 continued to advance apple put in its peak on feb 12 microsoft on feb 10 the nasdaq put in its peak on february 19 therefore by the time the nasdaq peaked three of the five gafam stocks were already heading lower alphabet and amazon peaked on the same day as the nasdaq closing price basis monitoring the gafam stocks may have alerted investors that the technology sector was weakening even though the nasdaq 100 was still rising that said gafam stocks are not always a reliable indicator of what the sector will do 