What Are the Best Investment Opportunities of 2019?
From where we stand today, 2019 isn't exactly shaping up to be a stellar year for investors. After a decade of enjoying stocks on the rise, the public is finally getting a taste of what a bear market feels like again.
That taste, of course, is less than palatable for the average Joe on Main Street. No one wants to see their money disappear — seemingly into thin air — so most people either sell what they can or simply do nothing and watch in misery.
“When can I put my money back in the market?”
That's one of the questions I was asked by a member of the family this holiday, and it didn't surprise me in the slightest. Investors are losing faith in their investments, and for fair reason.
Interest rates are rising, FAANG stocks are at a plateau, and political gridlock is bringing our government to a halt. It may be the holiday season, but as far as the market goes, we're not seeing a whole lot of cheer.
Yet while much of this “bah humbug” is well founded, the world's smartest investors aren't going to find themselves taking a break from stocks in 2019. True, the DJI, NASDAQ, and S&P 500 are poised to take considerable damage this year, but that doesn't mean investment opportunities don't abound.
The truth is that what you learn about the stock market from the mainstream media is mostly smoke and mirrors. There are over 7,500 tradable securities on U.S. markets, but the S&P follows just 500 of them. The DJIA? Only 30.
Keep in mind, too, that's not including international or over-the-counter securities, so the next time CNBC or CNN tries to tell you about the stock market, understand that they're only looking at a sliver of the ice above the surface.
The reality most investors don't realize is that despite the constant focus on the S&P 500, Dow Jones Industrial Average, and NASDAQ Composite, none of these indices will ever dictate your ability to profit from individual stocks. True, a falling tide lowers all ships, but not all ships reside in the same body of water.
With 2019 at our doorstep, I won't sugarcoat it: The broader market looks ugly, and investors will need to be infinitely more diligent than they've been over the last decade. There won't be any free food this year; you're going to have to work for your dinner.
That said, the best investment opportunities of 2019 are already shaping up, despite the backdrop of bellwether positions selling off. You just need to know where to find them.
So what, then, will be the market-defying investment opportunities of 2019? Well, there are a fair number of answers to that question, but three big ones come to my mind right away.
2019 Opportunity #1: 5G Infrastructure
The first blockbuster investment opportunity of 2019 is one we've been talking about for quite some time now, and that's 5G infrastructure.
The world's first 5G mobile networks and phones will be officially coming out in first half of the year, which strongly suggests that this industry (and the stocks behind it) are primed to take off.
Due to the timing of these deployments, investors simply don't have the luxury of waiting out 2019. If you want a chance at profiting from the next generation of mobile connectivity, it would suffice to say that the time to strike is now.
2019 Opportunity #2: A Critical Supply Shortage
In addition to 5G, there is another timely investment opportunity brewing in the technology sector that you'll definitely want to know about in 2019. It won't carry the same level of mainstream hype as 5G, but the profit opportunity will be just as strong, if not stronger.
This one is a simple matter of supply and demand for a critical component found in virtually every electronic device being made today.
What these components do — temporarily store energy in electronic circuits — is not so important to know as why a massive supply gap of them is developing. There are three reasons:
First, devices being made today need more capacitors than they did yesterday. The latest iPhone, for example, has a stunning 1,000 capacitors inside, while older models needed just a few hundred. The same trend holds true for automobiles, which are becoming increasingly reliant on electronics.
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Second, on top of more of these components being packed into every device we make, there are more devices being made using capacitors, period. The Internet of Things (IoT) in particular is driving incredible demand for these components, as everything from our thermostats to power outlets become computerized and connected.
Finally, there is the issue of constrained supply. For years, the industry has relied heavily on a small number of suppliers for its capacitors. Recently, though, the largest of these suppliers decided to pull out of the market, setting up for a multi-year capacitor crunch starting in 2019.
The takeaway is that with demand rising and supply low, smaller manufacturers are going to have a field day, or rather field year in 2019.
2019 Opportunity #3: Fast Biotech Profits
Selling stocks ahead of a bear market is as wise a move as any, but that doesn't mean you should be sitting on your cash and doing nothing with it at all. If you can find short-term trading opportunities, it's possible to limit your risk of holding stocks in a bear market while still actively taking advantage of stocks on the rare days they're going up.
This is one of the reasons why, in 2019, we'll be launching a brand new trading service to do just that. By trading around single-day catalysts, specifically in biotechnology and drug development, we're going to show investors like you how it's possible to earn significant profits whether the market is in bull or bear territory.
We'll have more information on that in the near future.
Until next time,
Jason Stutman is Wealth Daily's senior technology analyst and editor of investment advisory newsletters Technology and Opportunity and The Cutting Edge. His strategy for building winning portfolios is simple: Buy the disruptor, sell the disrupted.
Covering the broad sector of technology and occasionally dabbling in the political sphere, Jason has written hundreds of articles spanning topics from consumer electronics and development stage biotechnology to political forecasting and social commentary.
Outside the office Jason is a lover of science fiction and the outdoors, and an amateur squash player at best. He writes through the lens of a futurist, free market advocate, and fiscal conservative. Jason currently hails from Baltimore, Maryland, with roots in the great state of New York.
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