History Of Technology Investing
Technology Investing 2011, Not What it Used to Be!
Technology investing is the newest category of investing. Stocks in various industries and commodities of all kinds have traditionally dominated investment activities. Ever since the advent of the Industrial Revolution in the 19th century, interest in technology has increased and the return on investments in technology has likewise increased.
The last few decades have seen an explosion of technological advancements and a simultaneous explosion in the number of stocks derived from these innovations. Many people can report spectacular improvements in their portfolios due to timely investments made in companies founded upon technological insights decades ago, such as those that helped create Xerox and IBM. The lucrative possibilities in technology stocks remain to this day. Microsoft started out in someone’s garage and is now a stock giant. More recently, companies such as Google founded their entire business in the digital world and their stocks have given fantastic returns.
The Dangers & Rewards of Technology Investing
Technology investing is not without its dangers. A decade ago many people sank a great deal of investment money into companies that, much like Google, based their business on the newest technological environment – the Internet. When most of these businesses proved to have almost non-existent fundamentals, the value of their stocks plummeted in value. Investing in the newest gadgets and the latest ideas is, in a sense, still very similar to investing in more traditional stocks. An investor still needs to review a company’s fundamentals and decide if it has a viable plan for making a profit.
One way to increase your chances of success when investing in technology is to ascertain just how valuable the technology will be in the future. This is not easy to do. Many people passed on investing in personal computers in the 1970′s because they could not imagine why people would want one. It seems ridiculous now, but before something exists, it is hard to say how people might react to it.
One good bet for future investment in technology might be anything that supports the development of more advanced oil drills, since energy investing has become the most crucial element in many economies. Green energy technology also looks attractive. However, the best investment is one that performs well, not an investment that is simply chic at the moment.
Investing in new technology, while leading to many pitfalls, is also a path to investment success. This has been demonstrated on multiple occasions in recent years. The key to finding success in technology investing is examining the usefulness of a new technology.