5 Picks From The World Economic Forum
Being extremely wealthy can be lonely. Most of us can only imagine what it is like to no longer be concerned about money or possessions. To be able to do nearly everything you have ever imagined, with the world truly being a playground of opportunity and adventure. If you want to attend a party in Ibiza, then a meeting in Abu Dhabi the next day, no problem — just fire up your G5 jet, and you’re there!
#-ad_banner-#The loneliness comes from the fact that, outside of your trusted circle, there are not many things to talk about or discuss with others. Having to be forever on guard for phony friends and others who are only interested in your wealth must be extremely troubling. (I know most of us would love to have rich person problems!)
This fact is why the wealthiest people on the planet love to get together at annual events to talk with each other and plan their investments for the next year.
One of the most important events for the global elite is the World Economic Forum held annually in Davos, Switzerland. This year it ran from January 20-23.
Three thousand of the wealthiest citizens and global political leaders attended this year with the overarching theme of “responsive and responsible leadership.” A few of the big names that attended this year’s conference include: the Managing Director of the International Monetary Fund Christine Lagarde, Facebook COO Sheryl Sandberg, Actor Matt Damon, Former U.S. Vice President Joe Biden, China’s President Xi Jinping, British Prime Minister Theresa May, Alibaba founder Jack Ma, Microsoft founder Bill Gates, and Google’s Sergey Brin.
While many of the meetings are held behind closed doors, enough is made public that investors can get a handle on what the elite are expecting for the next year. To be sure, even though some journalistic liberties need to be taken to clarify the top stock market investments to profit from the exact themes of the conference, the broader topics are very clear.
Here’s a look at two major investible trends from the 2017 World Economic Forum and consider several securities primed to profit from each theme.
1. The Fourth Industrial Revolution
This is the number one investible trend discussed at the attendees at Davos. Professor Klaus Schwab defines the Fourth Industrial Revolution in this way, “The Third used electronics and information technology to automate production. Now a Fourth Industrial Revolution is building on the Third. It is characterized by a fusion of technologies that is blurring the lines between the physical, digital, and biological spheres”.
There are multiple ways investors can take advantage of the Fourth Industrial Revolution. Perhaps the most direct way discussed at Davos is driverless automobiles. The Davos discussions made clear that autonomous and driverless are not the same thing. Autonomous cars have a driver, but the driver can choose to drive or not drive depending on the situation. Driverless cars never have an inside human driver and are always controlled by an external or internal program.
This distinction is critical since autonomous cars exist today and many believe that real driverless cars will be on the mass market by 2022.
One of the most significant things for investors to understand is that technology is not an obstacle for driverless cars. The technology is already being used in controlled environments. Presently, the stumbling block is a seamless and highly reliable 5G wireless network that will allow the vehicles to communicate with each other and sense their surroundings.
It is within this system that the top investment opportunities lay, not only with driverless cars but the entire Fourth Industrial Revolution. Every part of the Fourth Industrial Revolution is dependent on seamless and flawless communication. 5G networks create this crucial infrastructure for the revolution.
Three leading companies in the 5G space are Ericsson (Nasdaq: ERIC), Nokia (NYSE: NOK), and Qualcomm (Nasdaq: QCOM).
2. Donald Trump
The changes expected under the Trump administration took center stage at Davos this year. Most of the attendees at Davos are globalists who are fervent supporters of laissez-faire economics and free trade. Trump’s nationalistic policies are similar to those of Nigel Farage, the British leader who supported Brexit. As you can likely guess, there is much tension between Trump and many of the Davos attendees. Despite this pressure, most leaders at the conference believe that 2017 will be unremarkable regarding financial volatility.
Trump’s America-first global policies will likely result in a stronger dollar and higher interest rates. My first choice of stock to benefit under Trump is iShares Russell 2000 ETF (NYSE: IWM). This ETF provides investors coverage of 2,000 small U.S. companies. IWM will likely profit from a rising dollar trend because small U.S. companies create substantially less of their sales from foreign countries when compared with sizable U.S. firms.
My next favorite way to profit from Trump is to invest in European multi-nationals who export heavily to the United States. WisdomTree Europe Hedged Equity ETF (NYSE: HEDJ) fits the bill here. This ETF is made up of 126 European multinationals that export to the Unites States, which tend to benefit from the rising dollar environment.
Action To Take: Position in these securities to align your investments with those of the world’s ultra-wealthy.
Editor’s Note: Bank on the “Rust Belt Revival,” the next big “Boomer” Phenomenon, or just cash in on “2017’s biggest Win-Win” the choices (and the profits) are all yours. Check out the list here…