3 Exciting Ways to Invest in Tech
The information and technology sectors are in the midst of another outstanding year, fueling stock market growth and keeping it in positive territory in 2018. The overall tech market in the United States is projected to grow 6.7 percent this year, which would be its strongest performance since 2012. Tech investors are not only making money but also providing much-needed capital that helps the industry continue to grow. Here are some options for technology sector investment.
A Good Option
You should strongly consider options trading. There are two types of options — “call” and “put.” The “call” option gives buyers the right to purchase an asset at a set price by or before a set date. The “put” option provides the right to sell. Investors buy calls if they think a security price will rise. The put option lets them sell a security at a set price, known as the “strike price.” With each, buyers and sellers hope the market moves in their direction and they’ll make a profit while limiting losses. This article provides an excellent overview of options trading basics.
Diversify With a Fund
Investing in an existing fund can be a good way to diversify holdings and invest in a small piece of a mammoth company. Some funds include tech industry giants like Apple, Microsoft, and Facebook. Some lean heavy toward semiconductors and information technology services. Other funds are broadly diversified, containing a combination of hardware, software, and payment brands. Whatever niche markets they operate in, you can rest assured that your investment will be stable and profitable over time.
Consider Individual Tech Sector Stocks
Check out the cloud computing sector. Companies are increasingly moving away from large servers to data hubs that store information in the cloud. The cloud saves companies money on front-end infrastructure. Cloud services also provide a steady stream of income since most garner revenue from subscription-based models. Some of the biggest companies in the world — Amazon, Alibaba, and Oracle, to name a few — are heavily invested in this sector.
Don’t ignore data and analytics. There’s no doubt that data has recently taken a bit of a beating, especially with some of the breaches that have made the news recently. Still, data-related stocks can be a buy since the big data analytics market is geared to surpass $200B worldwide in the next few years. Companies collect as much data as they can, and they’re investing tremendous resources in crunching numbers to learn more about the various behaviors of their customers.
Artificial Intelligence is exploding. The AI sector has seen a 70 percent growth in business value in 2018 and is a $3.9 trillion industry. And it’s only going to grow. Industry experts forecast that AI will be in all parts of our daily lives. Doctors will use AI to treat patients more quickly and efficiently. AI in robots could be used to help children with disabilities or assist caregivers in an increasingly aging population.
These are among the tips that can help you get started with technology stock investing. Play your cards right and you can enjoy tremendous returns.
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