The roaring 20´s, or in other words the period 1920 – 1929, is a period of roughly 10 years during which the western society experienced one of its most prosperous times. The roaring 20s were a period of immense advancement, both economic, social and cultural. During this extremely prosperous period a lot of industries experienced large-scale development, amongst which are the automobile, telephone and telecommunication, film and radio industries. With huge advancements in technology and modernization, suddenly everything became possible and only the sky was the limit. Although the roaring 20s are directly attributed to the United States, the same prosperous time was experienced throughout a major part of the western world including countries such as England, France and Germany. Being hopeful towards the end of the coronavirus pandemic and in the beginning of the 20s of the 21st century, we could potentially witness another extremely prosperous and advantageous time for our society, both economically and socially. After it crashed more than 35% during the month of March, the S&P 500 index has been making new all-time highs for the last 2 weeks, with the Dow Jones experiencing a similar crash and rise during the same period. Amidst this booming market though, there are 2 particular sectors that stand out as potential frontrunners and maybe even winners of the upcoming decade.
When it comes to industries with huge growth potential the electric vehicle industry is always involved in the discussion. It had a tremendous 2020 with the biggest winners being Chinese NIO and American Tesla, rising more than 700% and 415% respectively. In addition to the companies only producing EV´s a lot of mainstream automobile manufacturers have also jumped in with Volkswagen, Toyota and Nissan being the most prominent examples. According to a study done by Forbes, the EV sales as a percentage of all automobile sales are expected to hit 10% by 2025, 28% by 2030 and a staggering 58% by 2040.
Looking into the near-term future further growth can be expected not only in EV manufacturing but related industries and products as well, such as battery production and
lithium extraction. An important note to make here is that although exceptional growth is expected in the sector, that does in no way mean that every EV stock is a good investment. This situation could possibly be compared with the tech explosion during the late 90s and early 2000s. Although the internet was a revolutionary thing that really changed the world, most of the internet companies founded during the late 90s and early 2000s do not exist anymore and only a handful made it, such as Amazon and Google. Something similar could happen to the EV sector where in 10 – 20 years of all the companies founded now, only a handful would still exist. But with government incentives from countries around the world, and an increasing environmentally aware population, the EV sector is definitely one to keep an eye on in the next couple of years.
5G – The Next Generation
5G has been the centre of attention for quite a while now, both in a good and in a bad way. Although there have been quite a lot of conspiracy theories related to 5G, especially now during the COVID – 19 pandemic, it is an undeniable fact that 5G is here to stay. In 2017 the 5G infrastructure market size was around $371 Million but is projected to reach more than $58 Billion by 2025 at a staggering CAGR of 95.8%. The demand for 5G and 5G related services and products is expected to grow at a fast pace for the next decade. This growth in demand is driven by several things including the development of autonomous vehicles, increasing adoption of virtual telecommunications networking architecture and growth in mobile data traffic. Some of the best performing stocks related to the sector during 2020 have been T – Mobile, Qualcomm and AMD with respective increases of 30%, 64% and 71% since February 2020. 5G is definitely a sector to keep in mind in the next couple of years.