We recently compiled a list of the 11 Best Stocks To Invest In For Grandchildren. In this article, we are going to take a look at where Alphabet Inc. (NASDAQ:GOOG) stands against the other stocks.
In an era where financial literacy is increasingly recognized as a crucial life skill, teaching children about stock market investing can provide them with a significant advantage. Studies show that early financial education leads to better money management, long-term wealth accumulation, and greater financial security in adulthood. By introducing children to investing at a young age, they can develop a mindset of patience, risk assessment, and the power of compounding—principles that can shape their financial future. A 2023 study by the National Financial Educators Council (NFEC) found that a lack of financial literacy costs the average American $1,819 per year. Teaching children about investing early can help reduce this financial gap and equip them with the necessary skills to navigate economic challenges. Introducing children to stocks helps them understand concepts like risk and reward, diversification, and market fluctuations. Learning how companies operate and grow their revenue also fosters a deeper understanding of the economy. This knowledge can prevent common financial mistakes such as emotional investing, excessive debt, and poor money management.
Read more about these developments by accessing 10 Best AI Data Center Stocks and 10 Buzzing AI Stocks According to Goldman Sachs.
One of the most compelling reasons to teach children about investing is the power of compound interest. If a child begins investing at age 10 instead of waiting until age 30, they could amass significantly more wealth by retirement, simply by starting early. Teaching children about stocks encourages critical thinking and discipline in financial decisions. Instead of seeing money as something to be spent impulsively, they learn the value of investing for the future. A study by Fidelity Investments found that 82% of parents who teach their children about finances believe it leads to greater financial independence. Additionally, teaching investment concepts through real-life experiences, such as monitoring a stock portfolio, fosters engagement and practical learning. With advancements in AI, automation, and digital finance, future generations will need financial acumen to navigate an evolving economy. Experts suggest that children who understand investing will be better prepared for retirement, homeownership, and entrepreneurship.
Read more about these developments by accessing 30 Most Important AI Stocks According to BlackRock and Beyond the Tech Giants: 35 Non-Tech AI Opportunities.
For this article, we scoured investing forums, analyst reports, and advice from money managers and billionaires and compiled a list of stock options that are deemed the best for a child in the modern world. These stocks are also popular among hedge funds. Why are we interested in the stocks that hedge funds pile into? The reason is simple: our research has shown that we can outperform the market by imitating the top stock picks of the best hedge funds. Our quarterly newsletter’s strategy selects 14 small-cap and large-cap stocks every quarter and has returned 275% since May 2014, beating its benchmark by 150 percentage points (see more details here).
A laptop and phone open to Google’s services in an everyday setting.
Alphabet Inc. (NASDAQ:GOOG)
Number of Hedge Fund Holders: 160
Alphabet Inc. (NASDAQ:GOOG) is a technology company that owns and runs the internet search engine Google. As per the results for the fourth quarter of 2024, the company reported consolidated revenues of $96.5 billion, marking a 12% year-over-year increase and reflecting strong momentum across the business. In February, Google released the Gemini 2.0 artificial intelligence model suite to everyone. The suite of models includes 2.0 Flash, described as a reliable workhorse ideal for high-volume, fast-paced tasks. The latest earnings report reveals that Alphabet expects to invest about $75 billion in capital expenditures in 2025, indicating Alphabet’s strategy to diversify beyond its core advertising business.
Overall GOOG ranks 5th on our list of the best stocks to invest in for grandchildren. While we acknowledge the potential of GOOG as an investment, our conviction lies in the belief that some stocks hold greater promise for delivering higher returns, and doing so within a shorter timeframe. If you are looking for a stock that is more promising than GOOG but that trades at less than 5 times its earnings, check out our report about the cheapest AI stock.
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Disclosure: None. This article is originally published at Insider Monkey.
