I remember too well the dot.com boom days of the late 1990’s when the rapidly evolving technology sector propelled stock markets around the world to exciting new highs. These new hot stocks offered investors the promise of a new era and exciting returns for those brave enough to position in a host of new companies searching for investment dollars.
Whilst sadly many of those stocks are no longer with us, quite a few still are and have gone on to become household names and in the process generated exceptionally high returns for those savvy investors who backed the right horse in those early days.
Now, some two decades later, the technology sector is soaring again, with the technology heavy Nasdaq index outperforming the broader Dow Jones Industrial Index by an annual rate of 10% over the past ten years. Once again, it’s an exciting time for investors as businesses and consumers throughout the world are taking advantage of the rapid advancements made in a wide range of new and innovative technologies coming to the market. Whilst initially slow to adapt companies throughout the world are using new technologies to offer new services and save on costs and many more small companies and startups are transforming and starting up, many backed through venture capital firms which see the potential for superior returns as the technology sector continues to mature.
As a brief guide with offer a few key technology themes that we believe offer significant advantages to business, as well as consumers, and which we recommend investors study up on and look to gain exposure too.
This potentially game changing technology has taken the world by storm, most especially in the last few years as the most popular application, in the form of Bitcoins, has provided exceptional returns for investors. In layman terms, a blockchain is a form of digital ledger which creates a public and chronological record of all transactions undertaken using cryptocurrencies. The technology was invented in 2008, creating the digital currency bitcoin, and as it continues to develop businesses are now looking for other uses, apart from the widely popular bitcoins, to make use of this new technology.
From initially being used as digital platform for connecting people from all different parts of the world the technology has now evolved into a profitable and convenient marketing tool for all businesses. In doing so the development of social media technology has created many new and engaging forms of marketing which are driving significant change in the way businesses react with consumers and generating substantial new revenue flows in the process. When you consider how many people use social media every day and the amount of new money that is being invested in development to advance and grow social media, we are sure it will provide exciting opportunities for investors well into the future.
It’s a sign of just how far we have come when it comes to the invention of 3D printing which has to be one of the most exciting technological developments of recent times. This technology has the potential to drastically change the way the manufacturing industry works, enabling businesses to produce and customize prototypes quickly and cost effectively and ultimately bring products to the market sooner and most likely at less cost to the consumer. We have great expectations for companies within this space and believe that as the industry continues to advance and as the number of applications grow, savvy investors can expect rewarding returns over time.
Whilst the real commercialization of drones is still in its infant state this new application for an existing technology offers the potential for a relatively quick transition towards providing some very innovative commercial uses in the near future. Just think about Amazon’s plans for its Amazon Prime Air delivery service. Whilst it will still take substantial time for many commercial uses to reach critical points, the delivery industry faces many obstacles to overcome, early stage use of drones. Adopters within nontraditional businesses for new tech, such as construction, agriculture and security industries are already benefiting significantly from the use of drones. These are just a few of what we consider to be highlights of recent new trends in technology and as innovators continue to create new discoveries and uses every day, we believe it is an excellent time for investors to keep up with the newly emerging opportunities for investment within the rapidly evolving technological sector.