10 Titans of Tech to Power Up Your Profits

This has been a wild year for the market. And it’s just barely begun! But there is one group that is bulletproof …

I’m talking about FANG-Plus. And this group could point the past toward higher profits for you. At least, if you believe in the Cycle of Innovation. 

What’s the Cycle of Innovation? It’s a theory by an Austrian-born economist named Joseph Schumpeter. He believed capitalism could only be understood as an evolutionary process of continuous innovation and creative destruction.

Schumpeter believed these cycles happened in waves …

He combined previous economic theories about cycles: Kondratiev (54 years), Kuznets (18 years), Juglar (9 years) and Kitchin (about 4 years). Schumpeter added them together to form a composite wave.

And Schumpeter’s theory of long cycles emphasized the initiating role of innovations.

The first wave of innovation and economic expansion was the primary wave. This was followed by a secondary wave. A whole new round of innovation which sprang from the first wave.

OK, enough boring economic talk. Let’s get to the good stuff …

Ride the Wealth Wave of the Innovation Cycle Today

Maybe you’ve heard of FANG — Facebook, Amazon, Netflix and Google. They’re the cream of the tech-stock crop.

But have you heard of FANG-Plus? That’s also called the Global FANG stocks. It includes the S&P 500 darlings — and international stocks as well. Here they are …

  1. Netflix (Nasdaq: NFLX)
  2. Twitter (Nasdaq: TWTR)
  3. com (Nasdaq: AMZN)
  4. Nvidia Corp. (Nasdaq: NVDA)
  5. Alibaba Group (NYSE: BABA)
  6. Baidu (Nasdaq: BIDU)
  7. Alphabet (Nasdaq: GOOG)
  8. Tesla (Nasdaq: TSLA)
  9. Apple (Nasdaq: AAPL)
  • Facebook (Nasdaq: FB)

Together, this group is tracked in the NYSE FANG+ Index. And it is running rings around the S&P 500 …

That price action almost looks wave-like, doesn’t it?

And it hasn’t peaked yet.

Interestingly, some of the biggest names in tech aren’t FANG-plus. For example, Microsoft (Nasdaq: MSFT) and Cisco (Nasdaq: CSCO) are big. But they aren’t in the index. They aren’t considered innovators, either. Sorry, Mister Softee!

Going forward, I expect the FANG-plus stocks to continue to outperform. That’s simply how indexes work.

By that, I mean thanks to indexing, the humongous tech companies of FANG-plus make up an increasing share of investor portfolios. And that’s regardless of whether they buy individual stocks.

For example, Apple is 4% of the S&P 500. Anytime investors buy the leading index, 4% of the money boosts Apple’s stock.

These FANG-plus stocks should continue to lead until the next cycle of innovation begins. And then we could see a whole new flock of winners.

But for now, bet on FANG. Those stocks are beating the market. And they’ll power up your portfolio, too.

All the best,
Sean Brodrick

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One comment on “10 Titans of Tech to Power Up Your Profits

  1. Chad Olson February 27, 2018

    What is going on with the Canadian cannabis stocks? They are going down consistently particularly Aphria. I haven’t read any news other than legalization could be delayed until September. Wondering what your thoughts are on that sector.