By Nathan Bennett
Happy Birthday, USA!
I’m an unapologetic fan of the 4th of July. I think America is the best country on earth (despite our efforts to mess it up), and I love taking a day to celebrate the birth of our nation. I hope you get to enjoy the fireworks and fire up the barbecue with friends to celebrate Ol’ Glory!
Recently I had the chance to spend some personal time with a mutual fund manager who focuses on innovation and technology. Naturally I peppered him with questions about the future of technology, the markets, and his worldview in light of our current aging bull market. His unbridled optimism was striking! I expected a bit of hedging, or some worry that valuations were stretched. I got nothing of the kind. He was terribly excited about the future of Payments (a large % of global transactions are still done in cash), Robotics (they are improving rapidly), Energy Storage (we can be so much more efficient), and Biotech (game changer for health care and the combat of disease). Honestly, I was forcing myself to be a skeptic because his case was compelling.
Today I ran across the statistics below which illustrated just how dominant the U.S. is in the technology space. If my friend is even close to right, and our country is the market leader in that technological growth – I can’t help but be excited about the future.
-U.S. companies represent more than half of the MSCI All Country World Index’s market capitalization. Impressively, U.S. companies comprise over 70% of the index’s technology sector market value.1
-Spending about half a trillion dollars on research and development (R&D), the U.S. leads the world; R&D investments are approximately one third larger in the U.S. than in the European Union.1
-U.S. R&D is of the highest quality, with the World Intellectual Property Organization ranking the U.S. as the global leader in innovation quality based on strong universities, wide globalization of local inventions, and heavily cited research publications.2
Happy 4th of July! May our innovation continue to explode like the fireworks we enjoy this week!
1Alger On The Money – June 27 2018
2Global Innovation Index 2017
|This material represents an assessment of the market environment at a specific point in time and is not intended to be a forecast of future events, or a guarantee of future results. This information should not be relied upon by the reader as research or investment advice regarding any funds or stocks, nor should it be construed as a recommendation to purchase or sell a security. Past performance is no guarantee of future results. Investments will fluctuate and when redeemed may be worth more or less than when originally invested.
The MSCI ACWI Index, MSCI’s flagship global equity index, is designed to represent performance of the full opportunity set of large- and mid-cap stocks across 23 developed and 24 emerging markets. As of March 2018, it covers more than 2,400 constituents across 11 sectors and approximately 85% of the free float-adjusted market capitalization in each market.
Investments that focus in one sector may involve a greater degree of risk and volatility than an investment with greater diversification.One cannot invest in an index. Investments will fluctuate and when redeemed may be worth more or less than when originally invested.
TR# 216453 DOFU 06/18