As the year winds to a close, stockholders are looking towards top investing trends for 2022. Savvy investors know that staying on top of emerging trends is important.
Every other day, we see renewed calls for a steep market correction. Nowadays, many people invest like crazy when they hear about something new coming out from big-name companies or celebrities with money. But this can set you up with huge losses if those investments don’t pan out as expected.
Consequently, it is important to do your research. It would help if you understood what stocks are, how they work, and where you can find information on them before making any decisions about buying or selling shares. A stock market is chaotic, where short-term fluctuations can have lasting effects.
Seasoned investors can see beyond the noise and identify trends that will pay off for them over many years, sometimes resulting in significant gains on their investment portfolios when this occurs.
Hwew five hyper-growth top investing trends for next year:
- Blockchain
- Electric vehicles
- Real estate
- Artificial intelligence
- Data science
Top Investing Trends: Blockchain
Blockchain is an innovative way for people to store and exchange data securely. The technology is not new. It has been around since the ’90s. But it wasn’t until 2009 when Bitcoin (CCC:BTC-USD) was created as a proof-of-concept that blockchain took off in popularity.
Following Bitcoin’s lead, several coins popped up in the last decade. Ethereum (CCC:ETH-USD), Ripple (CCC:XRP), and a host of other powerful cryptocurrencies are looking to change how we interact with each other and the industries around us.
A blockchain is a powerful tool that you can use for many different purposes. It’s the secure and transparent recording of transactions, done in real-time across borders with no third party required. This makes it more efficient than the current systems we have today. The pharmaceutical industry can improve its supply chains by using blockchain technology. With this, they can track things such as vaccine distributions or food units for traceback protection that could be valuable to both vendors and consumers alike.
You can also keep your social security number, birth certificate, and other sensitive information on the blockchain. It is tremendously useful for governments to keep this information safe and free from error. Cardano’s (CCC:ADA-USD) IOHK is working with several African countries to test this hypothesis by helping address issues in academia.
But perhaps the major use for blockchain is smart contracts. All trade agreements are like regular contracts, except for the rules enforced in real-time on a blockchain. This innovation eliminates intermediaries and adds another level of accountability. It saves businesses time and money while also ensuring compliance from everyone associated with it.
Electric Vehicles
Electric vehicles are the future. They offer a similar range and speed to gas-powered cars with no carbon emissions, making them perfect for people who care about their health and the environment. Electric car ownership has been on the rise lately partly because of increasing fuel prices and improvements like more efficient batteries. That leads some experts to say that eventually, these technologies will drive out all combustion engine-based transportation altogether.
The electric vehicle industry is on a path to transforming the global economy. With trillions of dollars in potential profits at stake, major automakers are investing heavily into making EVs more affordable and practical for everyday transportation needs through increased production plans that could phase out gas-powered vehicles by 2030s or even earlier.
There are several options if you want to invest in this industry. From electric-vehicle makers like Tesla (NASDAQ:TSLA) and Nio (NYSE:NIO), semiconductor producers like Nvidia (NASDAQ:NVDA), Intel (NASDAQ:INTC), and cloud providers such as Microsoft (NASDAQ:MSFT) and Alphabet (NASDAQ:GOOG, NASDAQ:GOOGL), there is a wide spectrum of companies involved in EVs.
Ford (NYSE:F) plans to invest heavily in electric vehicles, with CEO Jim Farley expecting their production capacity for this type of vehicle will eventually reach 600,000 globally by 2023. “The demand is so much higher than we expected,” the executive said. “It’s a really new experience for this big company, trying to be agile. We had to approach it very differently than we’ve done capacity planning.”
On the other hand, General Motors (NYSE:GM) plans to sell 1 million EVs globally by 2025. By the end of 2025, General Motors expects to have a portfolio of 30 all-electric vehicles. Like General Motors, it wants to sell a million EVs per year by 2025.
Top Investing Trends: Real Estate
Physical real estate is the preferred investment for many Americans. A real estate investment can be a great way to build your wealth and enjoy the many benefits, including tax breaks. Its reputation as a stable asset has made it a popular investment for many centuries. Real estate is excellent for those who want their money invested safely but still earn some return over time without too much risk.
There are several ways you can invest in real estate. A real estate development company is the backbone of any industry. They help create, construct, preserve, or renovate residential and commercial properties. However, the most popular way to invest in this sector is real estate investment trusts (REITs). They provide the same profit potential as LLCs or corporations while still being listed on stock exchanges and thus having access to wider investor pools than these other entities.
REITs can invest in several different asset types, such as residential apartments, office buildings, and hospitals, among other things. REITs are excellent if you want to diversify your portfolio and gain exposure to high-quality income streams. Due to the way they are structured, income investors highly value REITs. They must distribute at least 90% of taxable income in dividends or shares. In exchange, their income is exempt.
Some of the most popular real estate investment trusts include Simon Property Group (NYSE:SPG), Digital Realty (NYSE:DLR), Crown Castle International (NYSE:CCI), and Equinix (NASDAQ:EQIX). It is important to keep your portfolio needs before investing in this area. Most REITs invest in a specific niche. So, you have to pick and choose your spots effectively.
Artificial Intelligence
Artificial intelligence, or AI for short, is the ability of machines to imitate humans. It is accomplished through sophisticated algorithms that allow computers, phones, and other devices to understand how we behave when given certain instructions. From self-driving cars and robots to speech recognition software that can translate between languages with ease. It’s all thanks in large measure to how advanced AI is these days.
The technology is very powerful. Large enterprises and small ones will find it equally useful. They will save money through reduced human costs while improving productivity rates due to increased accuracy from automation. These benefits have led businesses all over America to adopt them one way another, which means we’ll continue seeing more adoption happen soon.
AI has become a part of many aspects of our lives, from using facial recognition software on Apple (NASDAQ:AAPL) smartphones and appliances like refrigerators or washing machines by Samsung Electronics (OTCMKTS:SSNLF) to automated algorithms in robot advisors for optimized investment decisions.
Suppose you invest in consumer discretionary stocks, then you might already have exposure to AI stocks. Most large-scale American companies leverage AI to get the most out of their datasets. That includes major conglomerates like Apple, Amazon (NASDAQ:AMZN), Tesla, and Alphabet. But you can also invest in pure-plays in the space. Notable names include Intuitive Surgical (NASDAQ:ISRG), CrowdStrike (NASDAQ:CRWD), and Nvidia, among others.
Investing Trends: Data Science
Data science is the future. Analysts and researchers will use their skills to create new insights by combining data in novel ways. The development of artificial intelligence and self-driving cars will be impossible without big data. You can say the same about pretty much every industry at the moment.
Healthcare, finance, manufacturing industries, advertising, no sector of our modern economy will not benefit from data science. The global data science platform market is projected to grow at a compound annual growth rate of 31.1% from 2019 to 2026, reaching $224.3 billion by 2026.
As big data and analytics become an integral part of technology, it is only natural that investors are trying to get their slice. Again, both large enterprises and small ones are taking advantage of data science. Some major ones include Tesla, Alphabet, and Meta (NASDAQ:FB). However, there are also several pure big data/data analytics companies. These include Snowflake (NYSE:SNOW) and Workiva (NYSE:WK). The only thing going against them is the high price multiples. That may lead investors to pour their capital into larger, more diversified companies instead.
On the publication date, Faizan Farooque did not have (either directly or indirectly) any positions in the securities mentioned in this article. The opinions expressed in this article are those of the writer, subject to the InvestorPlace.com Publishing Guidelines.
Faizan Farooque is a contributing author for InvestorPlace.com and numerous other financial sites. Faizan has several years of experience analyzing the stock market and was a former data journalist at S&P Global Market Intelligence.