My Top 7 Stocks to Buy For Small Accounts (HIGH GROWTH)

the key to finding great stocks is understanding a company's products not just their profits huge growth happens when a company makes the perfect product for a new or quickly growing Market Tesla made investors Rich by Conquering the growing electric vehicle market and Nvidia made millionaires by building the data center chips behind the generative AI Revolution and in this episode I'll highlight a few stocks set to win big in the AI era making them a great foundation for small portfolios your time is VI able so let's get right into it first things first I'm not here

to waste your time so here's what I'll cover in this video I'll start with a couple funds that set a solid foundation for any small portfolio I'll highlight a few Mega cap companies with great platforms products and services as well as some smaller AI companies with plenty of room to grow and then I'll share a few tips specifically aimed at growing smaller portfolios over time but let me point out three quick things before diving in first this isn't the ultimate stock list think of it as a solid foundation specifically for small portfolios in 2024 and

Beyond if you want to buy more great companies like Tesla down the road you can always add them in later but I picked the stocks in this video because they all work together second I'm not a financial adviser my background is in electrical engineering and data science and I have about 10 years of Industry experience using AI to solve real world problems that's why every stock I cover focuses on AI and I share my investments for educational purposes only and third there's a lot of ground to cover so I'll be keeping things pretty high level

this entire Channel focuses on the science behind the stocks so if there's a company that interests you you can probably find a video where I cover it in way more detail with all that out of the way let's get right into the investing in my opinion one or two funds make a great foundation for any long-term portfolio even small ones when I first started investing the advice I always heard was to put some money into the market every month which means buying the S&P 500 the S&P 500 tracks the 500 largest public us companies weighted

by their market cap that means the bigger the company the more of its stock is in this index there's actually a lot to like about the S&P 500 first off it's up by around 19% year-to date which is an amazing 7-month return When you consider how Diversified it is funds that track the S&P 500 also have very low fees for example the expense ratio for spy is just 0.945 which means for every $10,000 you invest you'd only pay $945 in fees each year that's not bad but the S&P has a few challenges for small portfolios

500 companies is a lot so this fund grows much slower than its own biggest Holdings its top five companies right now are Microsoft Apple Nvidia Amon Amazon and meta platforms Amazon is up by 30% meta platforms is up by 45% and Nvidia is up by almost 170% so far this year but the S&P 500 is up by much less since the other 490 or so companies have been performing much worse on average so one of the best things for smaller portfolios is to hold fewer stocks that way a winner can provide meaningful returns fewer stocks

means more volatility but that's a good thing for long-term investors since higher highs mean better returns and lower lows mean bigger discounts on the stocks you're already buying anyway so the first fund I'd consider for small portfolios is the NASDAQ 100 which tracks the 100 largest non-financial companies listed on the NASDAQ stock exchange since this fund doesn't hold Financial companies like commercial Banks it gets filled with more Tech focused companies benefiting from this huge AI Boom the top five Holdings in the NASDAQ are exactly the same as the S&P 500 Apple Microsoft Nvidia Amazon and

meta platforms but since it only holds a 100 companies each one gets more weight which means the index can make bigger moves for example while the S&P 500 grew by a whopping 26% in 2023 the NASDAQ 100 crushed it growing by 54% that same year that's more than twice the returns during one of the best years in stock market history in fact the NASDAQ has outperformed the S&P in 12 of the last 15 years making a great way to reliably beat the market without getting lucky there are two options when it comes to buying this

fund QQQ or QQQ m in a nutshell long-term Buy and Hold investors should go with QQ qm because it has lower fees while bigger portfolios that use indexes as cash should consider QQQ since it has a much smaller spread the more more times you plan on buying and selling this fund the more you should consider QQQ for smaller portfolios consider starting with QQQ M the next fund I want to highlight is actually one of the best performing ETFs of all time and it's filled with the exact same stocks I always cover on this channel I

get asked all the time how I make these videos and I won't lie it takes a lot of organization from the research and writing to editing scheduling and performance tracking there's a lot to stay on on top of just like with any business side hustle or personal project that's why I'm so excited to tell you about clickup the sponsor of this video clickup is the ultimate One-Stop shop for personal and professional productivity it's super easy to create folders and pages for all your projects drag and drop text boxes task lists and attachments or if you're

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clickup for free by going to try clickup doco ticker or just use my link in the description and a big thank you to clickup and to you for supporting the Channel all right the other fun that can really grow small portfolios is the Vanek semiconductor ETF ticker symbol SMH which tracks the largest chip companies listed on major US exchanges I really like this ETF for a few key reasons first it only tracks 25 companies which means it's very concentrated its top five companies are Nvidia Taiwan semi conductor broadcom AMD and asml and together they make

up 51% of this fund with Nvidia having around a 20% waiting all on its own remember fewer stocks means more volatility which is a good thing for small portfolios that were actively contributing to and while the fees for SMH are 0.35% per year it's returned 64% year-to date 73% over the last 1 year and whopping 375% over the The Last 5 Years in fact SMH has a long history of high performance if you invested just $1,000 when it was created at the end of 2011 you'd have over $22,000 today and the next few years look

just as good for semiconductors since the global AI chip Market is expected to more than 11x in size over the next 9 years which is a compound annual growth rate of over 31% through 2033 that makes SMH a great fund to help grow smaller portfolios without getting lucky I'm spending a lot of time on the funds because investors with smaller portfolios shouldn't focus on trying to pick stocks they should build momentum by letting their money compound over time and the best way to do that is dollar cost averaging which is where you invest the same

amount of money every week or month or quarter not shares but dollars the great thing about DCA is you end up buying more shares for the same amount of money when prices are low and fewer shares when prices are high so the math is always in your favor I'll drop a link to a great article titled even God couldn't beat dollar cost averaging which compares the returns from dollar cost averaging to buying the exact bottom of every single dip which obviously would require Godlike timing and DCA still wins since you get more of your money

into the market earlier and the market tends to get more expensive over time that makes dollar cost averaging into high performing funds a great way to get rich without getting lucky then as your small portfolio grows it makes sense to start adding individual stocks but they shouldn't be random stocks you heard about from a friend or from someone on YouTube in fact some of the best stocks are the ones that everyone already knows about like the mega cap companies at the very top of the NASDAQ companies like apple Microsoft Amazon broadcom meta platforms Tesla Nvidia

and Google which together account for over 40% of the NASDAQ by weight but if you're just getting started how do you pick between these well-known Tech Giants in my opinion the best companies are the ones with platforms that other businesses pay to build on top of for example Microsoft Google and Amazon own a combined 2third of the global market for cloud services and millions of businesses pay them each year to do things like store and secure their company's data host mobile and web applications use their Computing clusters and access a wide variety of AI and

machine learning tools these Services run on top of massive Global networks of data centers that are incredibly expensive to research develop deploy maintain and upgrade over time and it would cost a business way more to build even a tiny fraction of these services for themselves so these Cloud providers won't be getting disrupted anytime soon even by generative Ai and all three of these companies have massive software and Hardware ecosystems that millions of businesses rely on and billions of consumers use every month making them great picks for portfolios of all sizes all right so far we've

picked two funds that give our small portfolio a high chance of beating the market and three Tech Giants that have a very wide range of services products and platforms used by millions of businesses and billions of consumers these next few companies are smaller and more specialized which makes them much more risky so if you have a small portfol you shouldn't lock too much of your hard-earned money into these kinds of companies until you've really done your homework and if you feel I've earned it consider hitting the like button and subscribing to the channel that really

helps me out and it lets me know to put out more content like this thanks and with that out of the way let's get into the smaller and more specialized stocks first up paler paler makes AI powered platforms that give huge Enterprises a real-time view of their data to optimize their operations paler platforms are of used in high-risk and highly regulated markets like National Security heavy Industries medical and international transport users can even send commands to assets under their control directly from Palante platforms for example a power company can monitor and rotate wind turbines a

logistics company can reroute their trucks and a commander can task different military units in real time which shows just how much some of the biggest governments and Enterprises on the planet trust palun platforms with their most sensitive data because of that paler Solutions need to be incredibly accurate fast and secure which is still a huge challenge for AI based tools today another reason that I picked paler is because it's a very agile company which is important because generative AI is evolving very quickly for example paler stood up their artificial intelligence platform or AIP just a

few months after chat GPT came out and it's now their most demanded platform do not make the mistake of investing in any company without understanding what it does and who its Target customers are I have personal experience using paler Foundry and I've made almost 20 videos over the last 3 years explaining paler platforms I'll leave a link to my paler playlist in the description below as well the second specialized stock for small portfolios that I want to highlight is crowd strike crowd strike is a cyber security company that focuses on endpoint detection and response they

have a cloud-based platform called Falcon to stop data breaches and respond to any attacks that do manage to get through Falcon has three parts first they have different cloud-based modules to perform tasks like antivirus scans manage firewalls and hunt down different cyber threats and malware part two is their proprietary threat graph which is a network map that tracks the connections between people mobile devices workstations data centers and pieces of cloud software in an organization and the Falcon agent is a tiny piece of software that runs on every device to capture data send it back to

crowdstrike for monitoring and Analysis keep their threat graph up to date and decide when to run the different Cloud modules behind the scenes Crow strike is the market leader in endpoint detection and response Gartner ranks crowd strike above Microsoft Sentinel 1 po Alto networks and fortunet in this area all of which are great companies and crowd strike stock has nearly tripled over the last year because they have the perfect products for securing data in these new and quickly growing AI markets and as I said at the very start of this video huge growth happens when

a company has the perfect product for new or quickly growing markets well the global Cloud security Market is expected to 6X over the next 8 years which is a compound annual growth rate of 20% per year another Market that set to grow fast is the global Edge Computing Market it's expected to roughly 4ex over the next 8 years which would be an 18% compound annual growth rate edai sometimes called on device AI is about to take off big time at a high level EDI is where laptops and phones are powerful enough to run AI models

on the spot instead of needing to send the work to servers in the cloud and wait for the results that means that AI at the edge runs way faster it's more secure and it can work without the internet for example the Samsung Galaxy s24 Ultra has has awesome AI features like Circle to search where you can Circle something on your screen to either search or reverse image search it or their live translate feature which can automatically detect the language of both speakers and convert speech to text and text to speech between them or their AI

enhanced camera which combines Optical and digital Zooms for up to a whopping 100x Zoom well the Samsung Galaxy s24 Ultra is powered by qualcomm's Snapdragon 8 gen 3 processor and The Meta Quest 3 is also powered by qualcomm's eighth generation Snapdragon XR chips which focus on using AI to enhance Graphics do Advanced Eye tracking and gesture recognition to create more immersive and realistic mixed reality experiences even the ray band meta smart glasses use Qualcomm Snapdragon AR chips to enable real-time photo audio and video processing as well as even streaming video inside this tiny form factor

all right now that we've covered a couple great funds three high- performing Tech Giants and three examples of smaller and more specialized companies let me put it all together with a few quick tips for growing small portfolios first and foremost I would put at least half of my money in the two funds starting with the NASDAQ 100 and using SMH to get more exposure to Great chip stocks on top of that since stocks like Nvidia and broadcom are at the top of both funds I get a lot of exposure to them without worrying about timing

the market or spending too much on fees I would put at least 30% of my money in one or more of the cloud service providers Amazon Microsoft and Google while almost all the big Tech Giants have been performing well these three companies have so many consumer products Enterprise services and solid revenue streams that they're basically portfolios themselves if I could only choose one it would be Microsoft since Azure is already the second biggest cloud service provider the fastest growing cloud service provider and Microsoft owns 49% of open Ai and by extension chat GPT but that's

just my opinion and I've been buying all three that leaves the last 20% for smaller more specialized and more speculative companies like paler crowd strike and Qualcomm these are all companies with strong leadership positions in quickly growing markets even over the tech Giants that we talked about but they're also very volatile which means you should practice discipline dollar cost average in and make sure to understand the science behind these stocks when it comes to growing a small portfolio that's the best way to get rich without getting lucky thanks for watching and until next time this

is ticker simple U my name is Alex reminding you that the best investment you can make is in you