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5 Industries to Invest in this Year

5 Industries to Invest in this Year

Investors can stick with tried and tested industries with slow but steady returns. Or they can invest in fast-growing sectors nearly guaranteed to yield significant returns. Know that you don’t have to go for penny stocks or try to find that next hot startup yourself. Instead, you can invest in a variety of industries that are certain to see strong growth in the near future. Here are five industries to invest in during 2019.

Finance

The deregulation of the financial industry could be a boon for banking institutions in 2019. The recent administration has made it clear that it was going to focus on heavy deregulation in a variety of sectors and the banking industry is one of them. Many of the regulations that were imposed on financial institutions after the crash of 2008 have increased operational costs, and with these regulations lifted, more financial institutions will begin to make big profits again.

As a matter of fact, according to a recent survey, almost 50% of banks reported that their compliance costs increased by over 20% after these regulations were passed. Lower costs after regulations are either repealed or revised could make finance one of the hottest sectors to invest in over the next coming year.

However, you don’t have to invest in name-brand banks to profit from this rebounding industry. Financial technology is actually an excellent place to invest your money because this is where competition for the big banks will come from. This category includes e-commerce platforms, rapid financing solutions, peer-to-peer payment services, and payment solutions. Cryptocurrency is a popular area for investors, but it is rapidly diversifying and subject to wild swings in valuation.

Social trading, which is the synthesis of social networking and market trading, is also a great way to invest in the financial sector. New traders can learn about trading from the pros, and depending on the social trading platform, copy the trades of successful traders for a modest price. Sites like InvestinGoal.com allow people to search for the best social trading platforms and emulate the trading strategies of others. They also offer great advice on how to start trading in sectors like forex. They’ll be able to teach you exactly how forex works and which social trading platforms are best for currency traders.

The Cloud

Software as a service, or SaaS, refers to businesses who sell cloud-based services. They may build a platform they rent to others or create a software platform on someone else’s cloud and charge recurring fees for access to it. In either case, they generate regular cash flow and can scale incredibly fast. The best investment opportunities in IT are not necessarily high-tech services like data miners, for instance. Two of the biggest SaaS firms are customer relationship management software services hosted on the cloud.

Salesforce, which sells access to its customer relationship management platform, and Zendesk, which is a customer support application, are two of the fastest growing and biggest players in the SaaS industry. They both allow users to access their software in exchange for recurring fees. And both platforms have seen impressive growth lately. The revenues of both companies have jumped 25 percent and 39 percent respectively for their latest second quarter compared to last year, and there is no sign of this growth slowing down. Especially when considering the ever-expanding demand for e-commerce solutions and the explosion of third-party hosted platforms like Shopify. We can expect to see more players enter the game in 2019 and more opportunities for savvy investors that want to bank on innovation in the sector.

The Cutting Edge of Medicine

Medical marijuana is now cutting-edge for medical investors since medical marijuana is legal in a number of states. Medical marijuana is seeing explosive growth, and it is more likely to remain legal while the government fights recreational marijuana use.

If you want something that is far more reliable, you could invest in businesses focused on elder care, since we’re starting to see a dramatic aging of the population. Whether you’re investing in medical device manufacturers who serve this population or companies developing tech to make it easier to age at home, there’s plenty of potential here. Surgical robots that perform minimally invasive surgeries that will be increasingly needed in the future. You can diversify by investing in nursing homes, home health firms, and other medical service providers who cater to this growing population.

IT Hardware

While apps, software, and the cloud get all the attention, we cannot afford to forget that these things still rely on hardware. If you want to invest in something more tangible, virtual reality is an under-appreciated option. This market is expected to be worth forty billion dollars by 2020. You can, of course, invest in game developers. However, the development of VR technology is equally important.

VR is only going to grow as 5G internet connections become more widely available. Another growing area is 3D sensor technology, like that pioneered by the latest smartphones. Don’t overlook the potential value of companies that build components that go into smartphones or the Internet of Things. While everyone else is investing in the big brand name firms, you could earn a hefty profit investing in the makers of cameras, microphones, and chips that go into those devices.

Green Energy

Green energy is going to continue to see strong growth. While there is uncertainty regarding federal policy, dozens of cities have expressed support for expanding renewable energy. This means that city and state grants are available to encourage people to install solar panels and implement renewable energy at all levels. Popular demand for this tech will also propel growth.

You should also keep an eye on electric cars as well. Fully electric vehicles to be specific. Tesla is finally seeing its efforts come to fruition and vehicle unit sales keep on growing year after year. And the company recently stated that it would ramp up the production of their Model 3s leading into the third quarter. GM is also heavily invested in the electric vehicle sector. And while their electric vehicle division is only one fraction of their overall business, they clearly are trying to compete with Tesla for market shares by releasing the Bolt, which is viewed as a more affordable option compared to Tesla’s mid-range and high-end vehicles.

Conclusion

We’ve provided these recommendations to save investors time and effort. If you know which industry sectors are growing, you can select almost any good company in the industry to invest in and see significant returns.


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by Harvey Carr // Harvey Carr is a contributor to Businessing Magazine.

Opinions expressed by contributors are their own.