- Nvidia is loved by young investors, but despite the alarm caused by DeepSeek and tariffs, many investors are still bullish about the company’s future.
Nvidia investors have had a mind-blowing experience in the last five years. The tech hardware company’s stock value has skyrocketed over 1,800% since 2020, elevating Nvidia to become one of the most valuable companies in the entire world—and interest from young investors may be to thank.
The company recently overtook Tesla as the top-held stock on Robinhood, the investing platform with 75% funded accounts held by Gen Z and Millenials. Robinhood CEO Vlad Tenev tells Bloomberg that investing in companies like Nvidia is going to be more important than ever, thanks to AI.
“I think AI is going to make investing more important because if control over the technology is going to be centralized in the technology companies, then you have to be an investor in those companies to benefit,” he says.
Many Gen Zers are already listening. On any given day, Nvidia is one of the most commonly discussed individual stocks on the 18-million-user strong subReddit r/wallstreetbets, and over 88,000 individuals are part of the NVDA_Stock community, one that exclusively discusses investing in the tech company.
Nvidia is a growing linchpin in the U.S. economy
Nvidia is one of the most closely watched stocks globally, and experts now say its earning reports are now on par with U.S. jobs reports in terms of driving market moves.
The company’s most recent earnings results smashed expectations, having generated $39.3 billion in the last part of 2024 alone. Many industry analysts are also bullish about Nvidia’s future, placing it in a “Buy” recommendation, according to Barron’s.
But the company has had somewhat of a rocky start to 2025. Off news of DeepSeek’s ability to match U.S. AI at a fraction of the cost, Nvidia’s value dropped $500 billion, and its stock price has somewhat stagnated ever since. This has led some investors to question whether the company’s impressive growth in 2023 and 2024 will be mimicked in the years to come, especially in the wake of tariffs and rising fears of a U.S. recession.
CNBC’s Jim Cramer says many Nvidia investors may be too quick to drop the stock.
“The relentless selling in Nvidia is a sign, once again, or the weak shareholder base that only knows it is a hot stock not that it is a great company, plus worries about a potential Taiwan sellout by President Trump,” Cramer wrote on X in early March.
Gen Zers are investing earlier than ever
Gen Zers are beginning to invest earlier than ever. According to Charles Schwab’s Moden Wealth Survey, the generation on average is starting at age 19—that’s compared to age 25 for Millenials and 35 for Baby Boomers. Given ongoing concerns about financial literacy, it’s more important than ever for younger generations to understand the risks associated with investing.
Sherron Permashwar, CPA and financial education expert, says for new investors, buying an individual stock or two, like Nvidia, can be a great way to become educated on the stock market and its ebbs and flows.
“You don’t want to make mistakes on your $400,000 portfolio. You want to make mistakes on your $4,000 portfolio,” she says.
Having a diversified portfolio, such as with an ETF, is the smart move since it can minimize risk, she adds. Moreover, despite Nvidia being the second-best performer in the entire S&P 500 last year, not having all your eggs in one basket can avoid falling for the misconception that past performance might dictate future results.
This story was originally featured on Fortune.com
Source link
Entertainment8 years ago