Investing in Technology According to Jeff Brown’s Near Future Report

Jeff Brown shares his insight by simplifying technical details to help subscribers make immediate gains from the market in his “Near Future Report.”

Tech stock investing

Industries in the information field, including telecom, electronics, automobiles, and computer components and applications, have shares in tech stocks.

Tech stocks have one of the highest growth potentials, but like most high-yield investments, they carry significant risk.

Since many tech companies are expensive, retail investors can benefit the most by investing in technology-oriented mutual funds and ETFs and minimizing overall risk.

Tech Stocks

There are many topics related to technology stocks in the world of investing: “Who is lagging in technology exchanges?” “Technology is the market leader.” “Will the tech bubble finally burst?”

However, what does “technological stock” mean? Strictly speaking, this term only applies to shares of technology companies. Categories such as telecom, electronic goods, commercial electronic devices, servers, microprocessors, hardware, applications, and information technology (IT) services are comparatively broad segments of this industry.

While generally related to innovative small startups, the tech sector also includes many famous giants like Microsoft and Apple.

These and comparable high-growth technology stocks have generated stockholders with above-average rates of return in past years and set a new record in 2020.

For vast information on tech stocks, you should look at The Near Future Report by Jeff Brown Investor.

Why should you invest in Tech Stocks?

Tech stocks generally take more risk than others, but they also promise significant growth. It has been a popular trend for several years. During the 21st century boom, tech stocks were at the forefront of growth. Over the past 5 to 10 years, the largest technology companies have outperformed the S&P 500 Index.

  • Facebook
  • Amazon
  • Apple
  • Alphabet (Google)
  • Microsoft

These five stocks on their own contributed 18 percent of the S&P 500 Index’s cumulative market capitalization in the first quarter of 2020.

Speaking of this turbulent year: the coronavirus does not even appear to be affecting tech stocks. Susannah Streeter, Senior Market, and Investment Analyst at Hargreaves Lansdown, said: “During the pandemic, the tech industry did very well, recovering from the crisis in March 2020 and setting a record.”

In general, high-tech stocks can attract more investors than other stocks. As they look to the future and promise to offer exciting new products or new platforms that will help them solidify market dominance, they are, in fact, synonymous with above-average growth.

“The behavioral changes caused by COVID-19 are only accelerating the digital trends that have swept across the economy. A timely development facility, Streeter said.

Cryptocurrency investing

Types of Tech Stocks

The technical department can be divided into many subsectors, and the value of each sub-sector is different. These are the most important ones:

Software

This typically refers to commercial and enterprise software but can also include consumer software and applications. The best-known examples are Microsoft, Oracle, SAP, Salesforce, Adobe, and VMware. Microsoft, Salesforce, and Adobe grew almost 50% or more in 2019-20.

Telecommunication

Telecommunications include telephone network companies, broadband networks, etc. The most important examples are AT&T, Verizon, Nippon Telegraph and Telephone, China Mobile, and Deutsche Telekom. However, some of them experienced negative growth in 2019-20.

Semiconductor

This section covers the inventories of companies producing semiconductors, processors, and other inbuilt materials used in computer equipment. The best notable ones include Intel, TSMC, Broadcom, Qualcomm, Micron Technology, and Texas Instruments.

In the 2019-2020 period, Taiwan Semiconductor Manufacturing Co. and Qualcomm expanded more than 50%, while Texas Instruments and Broadcom expanded more than 25%.

Technological Equipment

This industry involves businesses that design and produce computers, electronic goods, smart devices (phones, TVs, routers, printers, etc.), and every other digital tool you may need in the 21st century.

Apple, Samsung, Dell, Sony, Panasonic, Hewlett-Packard, and Lenovo fall into this category. Only Apple gained more than 80% from 2019-20, and Sony is around 48%.

Artificial Intelligence (AI)

Artificial intelligence includes deep learning (data scientists inspire computer models based on the human brain’s structure and function to replicate our ability to learn in essence) and machine learning (a type of artificial intelligence that can learn without special programming).

Amazon’s Alexa is perhaps the most famous AI, although IBM’s Watson has also garnered media attention.

Blockchain

Although Blockchain is the technology behind Bitcoin and other virtual currencies, it is well known. Nevertheless, it is not only an alternative payment method.

Blockchain is “distributed, decentralized digital ledgers linked to most cryptocurrencies, which are responsible for recording all transactions without the need for financial intermediation.”

Internet of Things (IoT)

The Internet of Things is a network of interconnected devices and clouds. The cloud is the public Internet that enables connections between remote systems. From smart thermostats (which can regulate your home’s temperature) to complicated medical equipment (which you can order yourself), it has it all.

Cloud

The cloud is a computer data storage system that allows devices to access information and services from anywhere. Cloud empowers businesses (and organizations) to access applications that are not accessible on their computers. Microsoft, Facebook, Amazon, and Google are the prominent leaders in cloud technology.

Cybersecurity

Data encryption is becoming a thriving business, as information is kept private and confidential and stored in the cloud. Cybersecurity is about making sure only the people who should see it have access to it.

Stock investing online

Drawbacks of Tech Stocks

Tech stocks have their own risk.

Given that current valuations are based on enormous future growth, high-tech stocks should be considered as high-risk from an investor perspective.

This is reflected in unusually high multiples of returns for these stocks compared to other industries on the On exchange, said John Cronin, a financial analyst at Goodbody.

In other words, tech stocks are generally priced based on their promise of future earnings. If not taken, these actions cannot justify their high prices and could deteriorate quickly.

However, some analysts argue that today’s tech industry is not as dangerous for investors as it is now. More companies have a credit history, and new products are based more on credible marketing research and data.

The valuation of this market has risen considerably compared to its historical background. The advance in demand has also been a great success. “Said Brad Gastwirth, Wedbush Securities chief technology strategist.

You should consider these tips and tricks if the stock falls.

Tesla car

Top 3 Tech Stocks

Tesla

Like some other entrants on this list, Tesla is not just a tech company. This is an automobile company that changes technology. The company is also a pioneer in the field of batteries and develops advanced solar solutions.

The biggest challenge Tesla faces is increasing the efficiency of its low-cost Model 3. In theory, if a company can meet Model 3 production targets, its long-term prospects will be more evident. However, until then, the company will continue to consume cash and may close as mature auto companies turn more to EVs.

Amazon

The online leader is undoubtedly the retailer, but there is no doubt that it is also a technology leader. In addition to developing its digital platform, Amazon has also become a device leader with its Echo speakers (built into the Alexa digital assistant), Kindle tablets and readers, and Fire TV products.

Alexa itself will turn the company into a technology powerhouse, as voice / AI-controlled assistants provide consumers with practical and helpful standards for home integration.

Amazon also plays a purely technical role in Amazon Web Services’ burgeoning cloud business. AWS generated more than $20 billion in revenue in 2017, making it the largest cloud provider. There are no signs of the growth slowing down anytime soon.

Netflix

It is impossible to define a company that produces both original content and purely technical work, but Netflix relies on its streaming platform. The company used the platform to expand its subscription business globally.

The company currently has 118.9 million paid members. At the end of the first quarter of 2018, the US (55 million) distribution and the rest of the world (63.82 million) were roughly the same.

In the first quarter, the company’s revenue grew 40.4% to $3.7 billion. Due to recent price increases in the US, this is the best quarter of growth since 2011. Additionally, the company added 7.4 million customers in the first quarter, compared to an increase of 8.3 million in the previous quarter.

Netflix still has excellent growth potential in the national and global market. The company will benefit from cutting cables and increasing the popularity of broadcast equipment and televisions equipped with broadcast media.

However, it must continue to invest billions of dollars ($80 billion) in 2018 to please existing users and attract new users.

CEO investment portfolio

Conclusion

While no one can guarantee that large technology companies will not experience volatility and recessions, their growth could outweigh any long-term losses.

Investors who wish to create a globally competitive investment strategy should reconsider applying it to their underlying assets. The returns they (tech stocks) provide are not equivalent to any other industry.

Here is some more information about investing in tech stocks.

If investors want as much appreciation as possible, they will better use some of their money in tech stocks.

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