Whether you’re a seasoned investor or just getting started, it’s not always easy to determine which industries deserve your attention. Looking at areas of growth is an excellent place to start. Here are some worthwhile possibilities to put on your shortlist.
Esports
Esports encompasses the exciting world of competitive, multiplayer gaming. Statistics project that the global industry will reach nearly $1.6 billion in revenue by 2023, after showing steady increases in previous years. Besides esports becoming a booming sector with people who like to play, it attracts millions of viewers.
The most readily available way to invest in this sector is through publicly traded stocks. Activision Blizzard and Electronic Arts are two examples of companies in the stock market with regular involvement in the esports industry.
One smart way to decide which specific companies deserve your investments is to look at the viewership and player statistics for the produced games that often feature in esports competitions. Do the teams behind those offerings regularly release content to keep people interested?
Information Technology
The information technology (IT) sector is one of the relatively few industries experiencing growth in today’s challenging economy. An increase in remote work during the COVID-19 pandemic was a massive part of what helped IT succeed.
Many companies decided that their employees can work from home forever if they wish. Along with that decision came an increase in IT products to help people stay safe from cyberthreats. For example, remote access control solutions can help people view company assets from anywhere.
The ultra-connectedness of our world means people should consider the IT sector a wise investment that will keep growing. Whether people engage with technology through laptops, smartphones or tablets, they’ll undoubtedly need IT products that promote usability, safety and productivity. Potential investors should also look at companies that use emerging technologies in forward-thinking ways. Many enterprises use artificial intelligence (AI) to screen for network abnormalities, and that’s just one way the IT sector continues to meet known needs.
Discount Retail
Many analysts warn that nations around the world — including the United States — should brace for a persistent economic downturn. If you’re thinking about investing, the first thing to do is ensure your finances can bear the risks involved, no matter the severity of the recession. The next smart consideration is to consider how people’s consumerism could change. Which outlets are most likely to stay successful even if households spend less?
Discount retailers have experienced growing demand during the COVID-19 pandemic. Dollar General reported that recent quarterly sales rose by approximately 19%, while Dollar Tree and Family Dollar saw a 7% sales increase. These discount chains performed well during the 2008 recession, and executives expect more of the same in current times.
Keep in mind that they sell things like toiletries, nonperishable foods and apparel. These are things people can’t realistically do without. However, those in challenging financial situations will look for cheaper alternatives for the staples they buy. Discount retailers offer just that.
Metal Fabrication
The metal industry is another area poised for growth over the next several years. Sectors ranging from aerospace to construction depend on custom-made pieces created through laser cutting and welding techniques.
The metal fabrication industry also supports future growth by investing in innovative technologies, including robotic welding equipment. As machinery becomes more advanced, the demand for skilled workers who can use it rises. Metal fabrication is a crucial aspect of manufacturing. That makes it a wise investment due to the number of other sectors that depend on these specialists.
As you narrow down the companies that may receive your investments, pay attention to what types of clients they generally serve. Consider how you could maximize your investment by choosing a metal fabrication company that primarily sources components for another growing sector.
Health Care
Investment experts often consider health care a safe industry because people need its offerings to survive. When someone’s finances get tight, they might stop ordering daily coffees from Starbucks and decide they don’t need to subscribe to so many streaming media services. However, they often avoid ceasing to spend money on things that directly support their well-being. Some have no choice but to do it, but they’ll look for other things to cut out first.
Although the overall health care industry will show promising growth, there are also segments within it that should experience exceptional success levels. For example, the telemedicine sector gained ground before COVID-19, but it exploded once the pandemic hit.
The home health industry is another area to watch. It’s doing well as people age and realize that they want to grow older in their houses rather than moving to assisted living facilities.
Online Grocery
Many people thought of online grocery shopping as an intriguing option before 2020. They frequently tried it and liked the convenience of having their goods brought to their doorsteps. As the COVID-19 pandemic emerged, online grocery shopping became necessary for people who could not safely leave their homes due to being in at-risk groups. Other individuals realized they preferred shopping online for essentials in any case because it seemed like the safest and simplest option.
Research indicates that online shopping will account for $250.26 billion of the estimated $1.16 trillion grocery market. That forecast also anticipates an increase of more than 60% in dollar sales estimates compared to before the pandemic.
You can tap into investment opportunities in this industry by looking at brands like Target and Walmart that provide home delivery services of groceries and other merchandise. Alternatively, consider investing in companies that explore high-tech solutions to improve online grocery shopping options, such as Ocado.
Closing Thoughts to Shape Your Investments
These industries seem set to perform strongly over at least the next several years. However, predictions and indicators of past successes do not guarantee positive future outcomes. Investing is an activity characterized by risk. You can reduce the possibility of adverse circumstances by diversifying your investments and being realistic about your risk tolerance.
You should also consider occasionally rebalancing your portfolio by returning to the original asset allocations. That’s another way to help things work in your favor by ensuring you do not place too much emphasis on one particular industry or company.
If you do not have a lot of investment experience yet, consider starting conservatively and increasing your involvement as you become more accustomed to the activity. Getting guidance from an investment professional could also be a worthwhile choice, especially if you’re eager to get started but have some hesitation about specific decisions to make.
Finally, remember to keep a balanced and realistic perspective. Even the best-performing stocks and companies can plunge overnight. As you become a seasoned, confident investor, you’ll learn to spot some of the trends that may signal downturns and convince you to sell. Even so, some events may take you by surprise. Provided you accept the uncertainty that investments can bring, you’re in an excellent position to begin or expand your portfolio.
Lexie is a digital nomad and graphic designer. If she’s not traveling to various parts of the country, you can find her at the local flea markets or hiking with her goldendoodle. Check out her design blog, Design Roast, and connect with her on Twitter @lexieludesigner.
