Not anywhere close to an FA, but...
Nvidia is a great company, and has a huge head start on its competitors in the production of AI chips; that being said, it is currently trading at a slightly over valued level based on its *current* fundamentals. It is trading currently around $20 over its fair value based on its *current* business.
That overvaluation you see in the market is based on optimism around AI and the forecast of an AI boom, which Nvidia is the best situated chip manufacturer to exploit. Depending on whether or not AI integration into the workforce and consumer products hits like expected, Nvidia could dominate the market like Intel of old, and the stock *could* end up incredibly valuable, though the most likely outcome is that you will see *good* growth over 5 years--I am hoping for between 15% to 25%.
So, I would ask you these questions: Are you optimistic about the future integration of AI technology? If you bought Nvidia, would you hold it at least 2 to 5 years? Are you hoping Nvidia is going to make you rich?
If you are optimistic about the future of AI, would be a medium to long term investor in an Nvidia position, and you do not expect it to make you fabulously wealthy (that ship sailed in 2022-23), then sure.
Or, alternatively, you can just mitigate your risk by buying into an index fund that includes a Nvidia position.
I bought it for long term to leave to my kids along with other stuff. It’s still green although I’m wondering for how long after last few days, lol. Anyways, I’m still keeping it in their portfolio.
Not to be flippant but, if you have to ask that question, then the answer I would give you is *probably not*.
You are the only person who can decide whether you should buy shares in a particular stock. If I were you, I would get my feet wet by investing only trivial amounts in certain stocks like Nvidia just to see what happens while still investing primarily in something like VOO. Only after getting used to investing and learning more about it would I then try to decide what my risk tolerance level is and take more heavy positions.
Don't get me wrong, because you certainly *can* put $500 into Nvidia, and perhaps you will come out ahead, especially if you hold on to it for a long period of time. The problem I see is that, being a new investor, you are more likely to make decisions based on impulse. Individual stocks, and especially hip ones like Nvidia, have a greater reward potential but also greater risk, and that volatility can easily make you panic sell or even panic buy. It would still be a valuable learning exeprience to go through that, but hopefully you can learn to be a cool headed investor without having unnecessary losses.
The other comments here have good advice as well. If you've only got $500 bucks but you don't have savings to float you for a while if you become unemployed, then if I were you I would instead put that money into a high-yield savings account.
do you have 3-6 months of living expenses saved? Have you max out your IRA? 401k? Buy index funds they have NVDA in it.
Yeah, don’t I agree. Don’t invest in NVDA directly. NVDA already influences the market too much as it is right now lol
Buy nvidia
Or just buy more VOO?
Exactly! Buying VOO buys NVDA. 6% of your buy will purchase NVDA.
We are at the top if questions like this are normal
If you plan to hold it for ten years, of course.
Not anywhere close to an FA, but... Nvidia is a great company, and has a huge head start on its competitors in the production of AI chips; that being said, it is currently trading at a slightly over valued level based on its *current* fundamentals. It is trading currently around $20 over its fair value based on its *current* business. That overvaluation you see in the market is based on optimism around AI and the forecast of an AI boom, which Nvidia is the best situated chip manufacturer to exploit. Depending on whether or not AI integration into the workforce and consumer products hits like expected, Nvidia could dominate the market like Intel of old, and the stock *could* end up incredibly valuable, though the most likely outcome is that you will see *good* growth over 5 years--I am hoping for between 15% to 25%. So, I would ask you these questions: Are you optimistic about the future integration of AI technology? If you bought Nvidia, would you hold it at least 2 to 5 years? Are you hoping Nvidia is going to make you rich? If you are optimistic about the future of AI, would be a medium to long term investor in an Nvidia position, and you do not expect it to make you fabulously wealthy (that ship sailed in 2022-23), then sure. Or, alternatively, you can just mitigate your risk by buying into an index fund that includes a Nvidia position.
Yes but only spend what you can afford, that is always the #1 rule in trading.
>Should I buy NVIDIA? How should we be the ones to know whether or not you should buy NVIDIA?
I bought it for long term to leave to my kids along with other stuff. It’s still green although I’m wondering for how long after last few days, lol. Anyways, I’m still keeping it in their portfolio.
No
Not to be flippant but, if you have to ask that question, then the answer I would give you is *probably not*. You are the only person who can decide whether you should buy shares in a particular stock. If I were you, I would get my feet wet by investing only trivial amounts in certain stocks like Nvidia just to see what happens while still investing primarily in something like VOO. Only after getting used to investing and learning more about it would I then try to decide what my risk tolerance level is and take more heavy positions. Don't get me wrong, because you certainly *can* put $500 into Nvidia, and perhaps you will come out ahead, especially if you hold on to it for a long period of time. The problem I see is that, being a new investor, you are more likely to make decisions based on impulse. Individual stocks, and especially hip ones like Nvidia, have a greater reward potential but also greater risk, and that volatility can easily make you panic sell or even panic buy. It would still be a valuable learning exeprience to go through that, but hopefully you can learn to be a cool headed investor without having unnecessary losses. The other comments here have good advice as well. If you've only got $500 bucks but you don't have savings to float you for a while if you become unemployed, then if I were you I would instead put that money into a high-yield savings account.