Saturday 16 / November / 2024
Muscat: When investing in stocks you would be forgiven for thinking the only certainty is uncertainty. Analysing stocks against the backdrop of the global factors that affect stock values, such as economic conditions and world events — for example how chaos in the Middle East can suddenly send oil prices spiralling at short notice — is an imprecise art.
That said, certain categories of stocks may offer a better chance than others for a steady return on investment. Technology is likely to be a winner in 2016, simply because tech generally is moving on at a rapid rate, with commensurate growth for the companies involved.
There again, careful decision making as to what type of tech and which companies to invest in is required. Research needs to be thorough; a useful source of market intelligence can be found on the IG Dubai website.
Major growth segments in the tech industry include: Internet of Things, The Cloud, Artificial Intelligence (AI), Big Data, Internet of Things.
Technology is growing at a rapid pace in this area. As devices, ranging from household appliances, cars, road infrastructure and industrial equipment, ‘talk’ to each other, so companies involved in this field are growing.
It is not necessarily new tech companies, however. Established corporations in other fields, such as Sony, Cable and Wireless (C&W) and General Electric, are experiencing, or expect to experience growth, as they are involved in supplying equipment. For example, Sony manufactures sensors that are used extensively to enable cars to ‘talk’ to each other, the driver, roads and building infrastructure.
The Cloud
This is well established for providing third party data storage and is a tech area likely to enjoy continued growth, as demand for storage grows with the increasing amount of data being generated. Here, established tech giants, such as Google and Microsoft, have a strong presence. Indeed, this is an area of great benefit to Microsoftwith their Azure platform, since their core software business is actually declining, in terms of turnover.
Artificial Intelligence
This is concerned with developments in computers and other tech ‘talking’ to us and being able to work things out for themselves. This is an area of strong growth, and — like Microsoft— is an area where an established company in a declining tech field can benefit from another.
IBM has experienced a general decline over recent years, but its involvement with artificial intelligence, with its Watson project, is a major growth area for the blue chip organisation.
Big Data
The rise in data generation and capture is rapidly accelerating, and it is mainly newer software companies that are providing the means for all this data to be analysed and processed.
Here, some careful analysis is required before investing, as many of these companies are experiencing huge growth, but are investing heavily in their businesses, so profits are presently less easy to find. This sector may be seen as one to watch for the future — at least in terms of profiting from it.
Old and new tech
Tech household names provide a mixed bag of investment potential. As described earlier, with Google and Microsoft becoming involved in newer growth developments, such as the Cloud, they could provide a relatively safe pair of hands, investment-wise, as they carefully diversify to embrace ‘new tech’. The same could possibly be said of IBM, concerning its involvement in artificial intelligence.
New tech is a potentially high growth and exciting field to invest in, but care needs to be taken inexactly choosing its whereabouts.
