Over the past decade, S&P 500 has delivered impressive average annual returns. Investors should consider using this year's stock market slump as an opportunity to add great companies to their portfolios at attractive prices. Nvidia (part of the МF Compass Global Trends portfolio) is one of those companies worth buying now.
Over the past few years, it has generated good returns for investors. Investment of $100,000 in early 2014. has become approximately 7.8 million by the end of 2021. The growth drivers underlying the company could provide impressive returns over the next 8 years as well.
Nvidia shares are up 20% of late, but are still down about -40% year-to-date. These are attractive levels for investors. In the 2014 fiscal year the company reported $4.1 billion in revenue, generated primarily from the sale of graphics cards to power personal computers (PCs). Then Nvidia began making moves into the data center market, and it has paid off handsomely over the years. At the end of 2022 the company reported revenue of $26.9 billion, with the data center business generating $10.6 billion. The good news is that the data center potential isn't done growing yet. Sales of accelerators such as CPUs (central processing units), GPUs (graphics processing units) and DPUs (data processing units) are expected to grow by 40% per year until 2030. This equates to nearly $156 billion in annual revenue at the end of the forecast period.
Nvidia is well positioned to make the most of the huge opportunity as it has a solid GPU market share. More important in this case is its deployment potential, thanks to its Grace processors, which have already been selected by several customers for deployment in 2023. The data center market alone could prove to be a strong tailwind for Nvidia through 2030. Analysts expect the company's earnings to grow at an annual rate of 23% over the next five years, but it wouldn't be surprising to see more rapid growth over a longer period of time due to additional opportunities in other emerging areas. Stocks may soar over the next eight years.
This information is marketing material and does not present investment consultation, advice, investment research, or investment recommendation. The information is valid as of the issue date of the marketing material and may alter in the future. The value of the units in the collective investment schemes changes over time and it could be higher or lower from the value at the time of the investment. No profits are guaranteed and risk exists for the investors to not receive the full amount of their investments. Investments are not guaranteed by a guarantee fund which is created by the country or another form of guarantee. Information on the performance of the financial instruments in the past is not a reliable indicator for future performance. Therefore, it is recommended for investors to acquaint themselves with the Prospectus and the Document with key information for investors before making a final investment decision. You can find these documents in Bulgarian on the website of Compass Invest - www.compass-invest.eu, and you can request and get a free paper copy at the office of the management company at: Sofia, 19 George Washington Str, floor 2, during every business day from 9 am to 5 pm. Future results are subject to taxation, which depends on the personal situation of each investor and may change in the future. A summary of the rights of the investors is available at the following hyperlink in Bulgarian: here. The mutual funds, which are managed by Compass Invest, are actively managed without following an index. We would like to inform you that Management Company Compass Invest can make a decision to terminate the offering of funds on the territory of the Republic of Bulgaria. The investment in units of mutual funds, in addition to benefits, carries certain risks like: liquid, operational, interest, currency, and political risk, as well as macroeconomical risk, currency risk, concentration risk, etc. The full information about risks can be found in the Prospectus of the respective fund.
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Risks:
Despite all the benefits, the investment in shares of mutual funds brings certain risks like:
1) Market risk with the following components: a) interest risk related to a decrease of the value of the investment due to a change of the interest rates levels b) currency risk related to a decrease of the value of the investment, denominated in a currency which is different from BGN and EUR c) price risk related to a decrease of the value of the investment in the case of unfavorable changes of the market’s prices;
2) Credit risk – related to a decrease of the value of the position in the case of unexpected events with a credit nature which are related to the issuers of financial instruments, the counter side of exchange and OTC transactions, as well as countries, in which they operate;
3) Operational risk – from errors or flaws in the system of the organization
4) Liquidity risk – in case of forced sales of assets under unfavorable market conditions;
5) Concentration risk – in case of incorrect diversification of exposures to groups of related clients, from the same economic branch, geographic area, etc.
6) Position risk which is related to the change of price of a certain instrument in result of factors related to the issuer or in case of a derivative instrument – related to the issuer of the base instrument;
Additional information for the risks can be found in the Prospectus of the respective fund, which is available here: www.compass-invest.eu