One could hardly be blamed for looking at the market these days and feeling a little bit uneasy about how to invest. Supply chains are strained, concerns about inflation are widespread, and people are quitting their jobs in record numbers.
But the thing is, tech is still the best place to make money investing. The NASDAQ, with its focus on technology and life sciences, has been seriously outperforming the S&P 500.
The tricky part is that the biggest names in the sector, the FAANG companies, are not the ones leading the way this time, and smaller-cap companies can make for choppy trading, since they don’t have the strength or presence in the market to pass on inflation-driven costs.
All of these factors combined can lead to no small amount of uncertainty, but that doesn’t mean it isn’t possible to approach the market carefully, control for risks, and maximize your chances.
People looking to the classic FAANG companies to lead the tech sector might be disappointed, but I want to make it clear that tech is still the place to be when looking for opportunities in the market. The tech-centric Nasdaq is leaving the broader S&P 500 in the dust in terms of gains. Now, things for small-cap companies can be a bit uncertain in light of concerns about inflation. They don’t have the market power that larger companies do, and so they can’t pass costs on to customers as easily. That being said, some of them have still won big. In addition, there are a few more companies with strong prospects that I have my eye on.
When he wondered whether or not he should sell some of his stock options before they expire this quarter, Elon Musk, CEO of Tesla Inc., sought an answer from the most powerful communications platform on Earth.
That’s right, Musk polled his more than 60 million followers on Twitter.
After the poll showed a clear 58% to 42% of Musk’s followers favored selling, shares of Tesla fell 5% on November 8.
But while the media was focused on Tesla’s action, they ignored a much larger story.
The fact is, despite its popularity, and despite dramatic episodes like this one, Twitter remains a lousy investment. It’s been dead money all year. By contrast, the S&P 500 is up more than 25%.
That’s why today I want to show you a backend way to gain from Twitter’s huge user base as well as the entire social media sector.
It’s finally time for Thanksgiving and that means a short trading week, turkey, and Black Friday. We are going to see some of the biggest shopping days of the year, and we will be watching to see if people are buying in-store or keeping their shopping to the internet. Big deals online will surely help some of our favorite e-commerce stocks like Shopify Inc. (SHOP).
Major tech earnings continue for another week and this time we have two companies that could tell us a lot about where tech is headed. First up is Nvidia Corp. (NVDA) on Wednesday, which is already up over 100% this year and then Applied Materials Inc. (AMAT) on Thursday, which could give us more insight into semiconductor supply issues. Given we are still in a shortage, Applied Materials could see a boost in orders. As the manufacturer of equipment to make semiconductors, this one could surprise us to the upside.
A Special Note from Michael: Before we get started today, I need to take a moment to mention another incredible high-tech trend I’ve noticed in the market. Cryptocurrency is going wild, with sector-leader Bitcoin setting a new all-time high of $68,000. The thing is, that may not even be the end of it. In the coming years, it may be as much as $500,000. The thing is, there are other cryptocurrencies on the market that could outperform Bitcoin by ten times over, and you can hear all about them right here.
When we spoke on Tuesday, I introduced you to the massive potential for investing in a new immersive field known as the metaverse. The thing is, I haven’t even covered the extent of the opportunity this new field will offer us.
I want to re-emphasize how big a deal it is that the top 12 firms that offer access to the all-encompassing technology alone now sport combined market caps of roughly $11.5 trillion dollars.
Now, Mark Zuckerberg is making a lot of noise about the billions that Facebook Inc., or as it’s now called, Meta Platforms Inc., is investing in this field to get an early mover advantage.
But that’s just a distraction. Last time, I noted that, at this point, Apple Inc. is a much better investment with more upside because its app store offers investors a premium metaverse portal.
But there’s another stock in this field that I want to tell you about as well.
To really understand the potential of this latest play, you’ll need to take a look using a very special “lens” – and I mean that literally, the lens of an advanced AR headset.
At this very moment, history is being made, and in a video game of all places.
The company behind this video game is not doing this with groundbreaking gameplay, storytelling, or graphics, but by showing the world just what this new thing called the “metaverse” is capable of.
Ahead of platforms like Zoom or YouTube, the video game “Roblox” is carving out a niche as a concert venue.
About a year ago, in November 2020, the musician Lil Nas X gave a concert on this platform and attracted no less than 33 million views. To put things in perspective, the world’s largest stadiums tend to only hold just over 100,000 people, and none are even as large as 200,000.
The size of Lil Nas X’s Roblox audience would still be more than 150 times bigger than even that. Now, another music act, a band called Twenty One Pilots, just held a Roblox concert of their own.
I believe this is the future of entertainment and a whole lot more. It’s an example of the unstoppable new metaverse tech trend, a trend into which Silicon Valley is investing billions, and which is destined to be worth trillions.
Last week the Federal Reserve unveiled its anticipated plan to begin tapering its monthly bond purchases and indicated it would remain patient about raising interest rates. Typically, when we hear about rising rates, it has a negative impact on high-growth tech. We didn’t see that this time around and the Nasdaq even rose 162 points that day. That is good news for us with more tech earnings on deck. We have Fintech leader PayPal Holdings Inc. (PYPL), digital ad giant The Trade Desk Inc. (TTD), crypto provider Coinbase Global Inc. (COIN), and many others.