Think back 15 yeas to the year 2000 — the dawn of a new millennium. Once Wall Street shook its fears about the Y2K computer crash, it was on to figuring out what to do about the dot-com bubble. Yet in hindsight, this digital era was entirely absent of tablets, smartphones and even Apple iPods (which wouldn’t come along until 2001).
So if we fast-forward to 2030 — 15 years from the present — what will trading look like? What disruptive technologies might enter the picture? Will some of today’s hot stocks remain that way? Any big surprises on the horizon?
Fearless or just plain fun forecasts abound, and here we’ve collected 10 from investment experts and market observers.
Need to trade? Ask the spawn of Siri. Virtual assistants will make the leap from smartphone pizza-parlor finders to portfolio minders — artificial intelligence assistants that take directions from their flesh-and-blood bosses. “If you have a question you need answered or an appointment scheduled, your virtual assistant will be always with you and always on,” says Todd Thibodeaux, president and CEO of the Computer Technology Industry Assocation. “IBM Watson technology set the bar, and companies are seeking to exceed those capabilities — to create a true humanlike companion that not only responds to your requests, but anticipates your needs and tends to your life.”
A bigger role for big data. The mighty numbers crunch of big data is already making an impact in retail and health care, and should play a bigger role in the trading environment. “Investing will be powered by a client-centric ecosystem — built to serve the investor first and foremost — where the millions of islands of data that exist today will be unified,” says Eric Poirier, CEO of Addepar, an investment platform. “Expert services and advice will be woven perfectly into the investors’ train of thought.”
Growth in biotech. Some sectors only stand to blossom with big players poised to deliver. “Biotechnology will do well, with Pfizer (ticker: PFE), Merck (MRk) and Johnson & Johnson (JNJ) leading the way,” says Mike Brady of Generosity Wealth Management in Boulder, Colorado. “The research and development needed to advance this area will be large, so only those with the resources to explore and exploit biotechnology will survive.”
Information security may be a lock. The movement of digital information will get more sophisticated — and unfortunately, so will hackers. “As information becomes more valuable, protecting it becomes more important,” says James Quin, a senior director at CDM Media, a think tank and conference facilitator for CIOs and technology venture capitalists. The trouble is that not many companies are ahead of the curve. “When you look at where we are today in information security, it is unfortunately a bit of a wasteland. Turning the table so that security becomes proactive instead of reactive is likely to take a good chunk of the time until 2030 to accomplish.”
Amazon will be prime. Amazon (AMZN) has had a great run lately, up more than 60 percent from a year ago. But the good news won’t end there, predicts Doug Cubberley, markets and investing editor for Investopedia. “Amazon will continue to grow and could supplant Wal-Mart (WMT) as the biggest retailer in the world, helped along by changing tastes and habits of shoppers.” But it won’t get there in a breeze, he says: “Just as Amazon suffered through years of unprofitability to scale up to its current status, we could see a competitor — either from the U.S. or abroad — come in and steal market share.”
Millennials could become centenarians. The timelines and formulas connected to retirement investing could change drastically, says Bill McManus, director of strategic markets at Hartford Funds. “Millennials will be faced with the prospects of both living to 100-plus and largely self-funding their golden years, since traditional pension plans may no longer be a part of the equation and Social Security faces demographic stress.”
Out of this world. It’s been the dream of many to mount an expedition to Mars, and some are disappointed that NASA hasn’t made any big moves in that direction. But that’s where private investment could step in. “By 2030, we will likely be funding off-Earth exploration in the spirit of the Dutch East India company,” says Leslie Bocskor, founder and managing partner of Electrum Partners.
No close shave. There’s no harm in yawning over the future of investment so long as the money keeps rolling in. “Those boring companies that provide a consistent cash flow will be those that provide the best returns to investors,” says Robert R. Johnson, president and CEO of The American College of Financial Services in Bryn Mawr, Pennsylvania. “I have a strong hunch that [Warren] Buffett-like companies that make razor blades, running shoes, furniture and ice cream will continue to be cash cows that generate good returns for investors.”
A healthy run of new investors. What will Americans of the future do if wages stagnate? Invest, that’s what. “Technology now makes it more cost-efficient for new companies to provide investment services to ordinary Americans,” says Andrei Cherny, CEO of Aspiration, a California-based investment firm. “At the same time, stagnating incomes from work will lead more Americans to look to investments to generate the funds they need to retire and meet other goals. Between now and 2030, we’ll see action in both the private and public sector that will make ownership of investments as universal as health care is today.”
It’s only a game. Some see the fall of barriers to investing as more companies get into the act of making it fun. “A recent trend called the ‘gamification’ of Wall Street has entertainment-based games popping up that allow people to learn about the stock market,” says Stephen Kalayjian, co-founder and COO of KnowVera, a financial market research company in New York. Brokers won’t get to play, though. “It will help bridge the gap into pop culture, and as technology continues to advance, trading will no longer only be possible through a few known exchanges with the help of a broker-dealer.”
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10 Investment Predictions for 2030 originally appeared on usnews.com
