Looking through the media this week, much has been made of the latest and greatest in the technology space. Wearable technology such as glasses, watches and an assortment of cool shiny things are likely to send the Generation me’s racing to their online shopping portals to get the latest and greatest.
How on earth did we manage without this?
Nothing stands in the way of technological development and getting in the right spot for the next big thing is an addictive thing – capitalising on the opportunity! However, as we saw in the technology boom and bust of the late 1990s and early 2000, all that glistens is not gold. Facebook’s debut left a fair mess on the floor, although its recent resurgence has rewarded investors who have stayed loyal to the stock. Equally, Apple has provided an interesting experience for the longer term holder too, with its stock price moving through a sizeable trading range.
But where is the opportunity??
Thinking broadly, perhaps it is not in the App, or in the actual technology firm, as you could be absolutely right or wrong. Instead, how about the suppliers of the components?
One area of particular interest is Sapphire Crystal. This is a particularly hard form of glass – the sort you find on a decent watch or timepiece – that is very scratch resistant. Apple have been touted as introducing this as part of the fingerprint recognition in their next version of iPhone and this has resulted in a great deal of interest in a previously unheard of sector.
Perhaps this may prove to be a catapult for stocks in this sector, in just the same way that we saw the likes of Lynas Corp roar ahead in the rare earth space a couple of years ago. In the case of Lynas, those glory days of $2.50 (last traded 41c) probably feels a lifetime ago!! Definitely worth a look though as there is something in this!
Technology is certainly a valid component within your investment portfolio and is part of the reason why we also trade the US market. However, it is only a portion, not the entire portfolio. Sometimes, having some more traditional aspects to your portfolio, adds value and shouldn’t be excluded. After all, slow and steady wins the race. Hence why I take the approach I do, and would encourage you to do the same.
High Tech or Old School?
I guess the comparison is like last week – I was in my parents’ village in the UK – thatched roof on the village pub, the old church and all – traditional, old school and solid.
Having had a few days at home, to unpack and repack the bag, today I am in Singapore – the hub of Asia and all that goes with that, in terms of technology, innovation and the new world.
Both places are great. I love nothing more than a bowl of chicken rice and a rojak salad, while up here – and usually for around $6 at my usual Singapore haunt. That said, I also love a nice pint, while sitting in the beer garden in the village – church bells tolling, leather on willow etc!
Both are great experiences and not mutually exclusive and the same should be said for your investing and trading. Have a core that is solid and steady, with some colour wrapped around it would not only make a lot of sense, but also a lot of dollars.
Upfront Cashflow and longer term growth?
That is why I have calls sold over my Lennar Corp, Disney and Fortescue stock (my hasn’t that had a bounce in spite of the mining boom being “over”!!). They have all paid great up front income and that cashflow is very useful.
That said, probably much like yourself, I am also looking for some colour around the fringes of my portfolio too. A couple of calendar spreads always help, and Sapphire Crystal may also be something that sits in my portfolio as well as on my wrist.