The prospects for disruptive technology investments are extremely bright

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It’s been a tough year for disruptive growth stocks, but there may be a silver lining to the struggles of this beloved style of investing.

A “blood in the streets” mentality may develop, which means that some foresighted investors may buy the dips – of which there are many to be done – in innovative growth stocks and related exchange-traded funds, including the ARK. Innovation ETF (NYSEArca: ARKK).

ARKK is down 13.43% from the beginning of the year. Obviously, this is not a stimulating performance, but it could also present an opportunity, particularly for patient and long-term investors as the long-term outlook for disruptive growth stocks is extremely compelling.

“According to our research, emerging innovation platforms will fundamentally transform our lives and the global economy, potentially taking their stock market capitalizations from around $ 14 trillion today to more than $ 200 trillion in 2030,” writes Renato Read , portfolio manager of ARK Investment Management.

Read highlights five areas of future innovation: artificial intelligence, DNA sequencing, robotics, energy storage, and blockchain technology, which could increase disruptive technology investments in the years to come. The actively managed ARKK has pioneered the combination of these themes under a single umbrella as the ETF offers exposure to fintech companies, energy storage companies, genomics revolution firms, and artificial intelligence and robotics technology providers. , among others.

With the coronavirus still lingering, it’s worth noting that while the pandemic has actually fostered greater adoption of many disruptive technologies, the track for those technologies is compelling with or without the health crisis.

“Spurred on by the coronavirus crisis, these platforms have come together to solve many problems over the past 18 months. As a result, the business value associated with their companies has doubled from about $ 7 trillion in 2019 to $ 14 trillion in 2020, “adds Law.

What is fascinating about the topics of artificial intelligence, DNA sequencing, robotics, energy storage and blockchain technology from an investment perspective is that they are still in their infancy. Together, these platforms had a company value of $ 14 trillion last year, but ARK believes that this figure could increase to $ 210 trillion in 2030. Even if that estimate goes to a few trillion dollars, it implies that ARKK it could reward investors over the long term.

“In our opinion, the coronavirus crisis has changed many behaviors in a profound and permanent way,” observes Leggi. “We believe these five innovation platforms will add significantly to investment opportunities in the future. They will replace old technologies and allow humans to carry out feats that seem unimaginable today. “

Bottom line: ARKK is down, but it hasn’t come out. The decline of the ETF in 2021 could prove to be an attractive buying opportunity.

For more news, information and strategies, visit the Disruptive Technology Channel.

The views and predictions expressed herein are solely those of Tom Lydon and may not come true. The information on this site should not be used or construed as an offer to sell, a solicitation of an offer to buy or a recommendation for any product.

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