Should you invest in something you don't fully understand? Some people, including the legendary Warren Buffett, would argue that you shouldn't. However, I think it's possible to gain sufficient knowledge about a market segment to invest in it without fully understanding it.
Quantum computing serves as a great example. Even if you don't have mastery of the complex technology, you can still profit from it. Here are two top quantum computing stocks that I think are excellent picks to buy in February.
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Alphabet: AI juggernaut with a quantum computing lottery ticket
Most investors view Google parent Alphabet (GOOG 1.22%) (GOOGL 1.12%) as an artificial intelligence (AI) stock. And rightfully so.
Google Cloud is the fastest growing among the three largest cloud services providers, thanks primarily to a huge AI tailwind. Google Search uses AI in its search algorithms and has integrated generative AI extensively. Google Gemini ranks among the top large language models (LLMs). Alphabet's Waymo unit is the leader in providing AI-powered autonomous ride-hailing services.
NASDAQ: GOOGL
Key Data Points
While Alphabet is an AI juggernaut, though, it also has what you might call a quantum computing lottery ticket. In 2019, Google Quantum AI's Sycamore quantum processor performed a calculation in less than three and a half minutes that the unit's team said would have taken the world's most powerful supercomputers at the time using the best-known algorithms roughly 10,000 years to handle. In 2023, Google Quantum AI built a logical qubit prototype that demonstrated the feasibility of reducing quantum errors by increasing the number of physical qubits.
I view Alphabet as a fantastic quantum computing stock to buy in February primarily because of its AI-fueled growth. However, the company is a legitimate contender to emerge as one of the biggest winners in the quantum computing market over the next decade.
IonQ: Arguably the best of the quantum computing pure plays
For investors seeking a quantum computing pure play, I think IonQ (IONQ 0.23%) is arguably the best alternative available. It's the largest of the pure play quantum computing stocks, with a market cap of nearly $14 billion. More importantly, there are two key reasons why IonQ could be the most successful of the group.
NYSE: IONQ
Key Data Points
First, the company believes that its trapped-ion architecture is the best approach to building quantum computers. IonQ's technology helps reduce quantum error rates. Its "all-to-all connectivity" where each qubit can directly interact (or entangle) with every other qubit holds the potential to simplify processing some algorithms. Trapped ions also exhibit long coherence, which means they can support more complex computations.
Second, IonQ focuses on multiple quantum technologies, including quantum computing, networking, sensing, and security. Because of this broad focus, IonQ claims to be "the only quantum platform company in the world." This multi-prong approach could pay off handsomely over the long term if and when quantum technology fulfills its potential.
