See, just about all of our electronics need advanced semiconductors. Besides mobile devices, microchips are a critical element of PCs, video cameras, web routers, game consoles, autos, and passenger planes.
No wonder forecasters at the World Semiconductor Trade Statistics service organization estimate that the worldwide chip market will have sales of $325 billion in 2014. That’s up 6.5% from last year.
Not only that, but Thomson Reuters estimates that, among the 15 tech sectors it tracks, chip and chip equipment companies will show the best earnings growth in the second quarter.
And semiconductors and mobile are just two of the major trends I follow. When you consider the daily advances we see in cloud computing, biotech, miracle materials, and Big Data, tech is definitely a “target-rich environment.”
And that’s where my “one tech investment to buy now and never sell” comes in.
This Tech Investment Is a Market Mirror
Many investors can find themselves overwhelmed by the dizzying array of tech stock choices.
In fact, many of the newer investors among you folks often ask me how to get started in high tech.
I also get many questions about which tech investments you should have in your retirement portfolio, or what is a “safe” play you can make for your kid’s college education fund.
If you’re asking yourself that sort of question, let me introduce you to the Fidelity Nasdaq Composite Index Tracking Stock (Nasdaq: ONEQ).
This exchange-traded fund (ETF), as the name says, perfectly mirrors the tech-focused Nasdaq.
It’s a fund that you should own for many years. It should be the recipient of consistent, scheduled investments.
And I believe it’s an investment you should look to keep forever.
The best way to capitalize on an investment vehicle like this is by using the well-known strategy known as “dollar-cost averaging.” You devote a small portion of your portfolio to it and continue to buy more at regular intervals over the long haul.
The beauty of this approach is that, by making regular, consistent contributions, you’ll automatically buy more shares when tech stocks are down and fewer when they’re expensive. And it puts a very powerful force on your side.
I’m talking about the power of “compounding.”
How to Put ONEQ to Work for You Today
With investments such as ONEQ, you set the retirement/college fund portion of your tech portfolio on autopilot.
Let’s assume a 12% return over 10 years, an initial $100 investment and a $30 monthly contribution. In 10 years, you’d find yourself with $7,387 – and $3,690 of it would be pure profit.
In 20 years, that same strategy would turn into $30,000 (a $22,717 profit). And in 30 it would turn into $100,000 (an $89,400 profit).