Digital Money Making: What You Need to Know About Investing in the Technology Industry

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If you’re new to investing in technology – you’re missing out. Over the past few decades, technology has seen some of the biggest growth ever. Imagine if you’d got involved in some of those huge multi-billion dollar companies when they were still small? Just because you missed out there – that doesn’t mean you can’t still make some good money by investing in tech.

 

So whether you’re new to investing in general or just the technology industry – this article is here to help. We’re going to give you a few tips so that you can get the most for the money you put into technology.

 

Learn the different tech areas and become an expert in a particular industry

 

If you’re going to invest your own money – you need to do the research and do a lot of it. That’s why a lot of people rely on fund managers to do the thinking for them, but you can still become an expert yourself if you really want to grow your money.

 

One key tip here is not to try and learn about everything. There are so many sub-sectors in tech that there are very few experts who know everything about all of them. Try not to spread the net too far and wide, and target a particular niche area so that you can really drill down on what’s important. Choose something you’re interested in, and then the research will be so much easier. If you do the right research and follow the right advice, you should see your technology profits increase.

 

What different areas are there?

 

AI

 

You might think that artificial intelligence is just for robots, but it’s not. There’s tons of tech out there and it’s developing at a rapid rate. This technology is helping businesses improve their customer experience offers as well as improving supply cycle management and helping consumers order the things they want quickly and easily. It’s quite a new technology, so there should still be some growth you can make the most of. If you’re interested in AI, it could be the next big thing – and it’s here to stay.

 

Software

 

While software investment has been around for a long time now – there’s still some money to be made. You might think that software is just to do with computer games, but it isn’t. Everyone who uses computers (or phones and tables) needs software to run their tasks. Businesses need software – like accounting suites and CRM management. Some software you might not even have heard of but if it’s a big player in a certain industry, it could be much bigger than you might think.

 

Try drilling down and picking a software niche, like graphic design software or e-commerce management platforms. Become an expert – and spot the right investment. The software is developing at a rapid rate, so don’t miss your chance to get in at the right time.

 

Hardware

 

From computer components to production machinery – hardware is just as important as the software it runs. If you’re into more of the engineering technology side of things, then have a look at investing in hardware. There are loads of new innovations all the time, and if you find one at the right time – you could be onto a winner.

 

Consumer electronics

 

While this does fit under the hardware category – there’s so much different hardware that many of them are niche industries themselves. Think about smartphone technology and other consumer electronics that have taken the world by storm in the last decade or so. Find the next big thing and watch the money start rolling in.

 

Internet technology

 

Instead of investing in physical tech, you might like the idea of jumping on the internet bandwagon. The internet saw massive growth and then re-adjustment, but it’s now a huge part of the investment industry, and there’s technology coming along all the time that you could invest in.

 

Blockchain

 

This one’s even newer – and while it plays a big role in cryptocurrency – it isn’t limited to that. It’s actually helping businesses find new ways of innovating and collaborating on complicated processes, and it should see a lot of growth over the next few years.

 

Cloud infrastructure

 

Here’s another big one that’s been growing at a fast rate – cloud storage and collaboration is an industry that’s appeared out of nowhere, and there could still be some good places to invest.

 

Semiconductors

 

Instead of investing in the actual hardware – what about what goes into it? There are big companies that you’ve probably never heard of who just make the chips and components that go into many popular items. You could invest in one of them, instead.

 

Be aware that returns can fluctuate heavily

 

Tech investment is no easier than any other – and it can sometimes be quite volatile. While you do see startups get bought out for billions, you also see many fails. So be aware of these fluctuations and be careful.

 

Paper trade before you risk money

 

Before you jump in, you might want to consider paper trading to make sure you know what you’re doing. Then if you lose, you won’t have actually lost.

 

Don’t risk too much

 

Be careful when investing. Don’t invest too much in one individual stock. Spread your outlay. Try for sustainable investments rather than boom-or-bust get rich quick stocks.

 

Growth vs Return investments

 

Some blue-chip stocks are considered steady investments. While this is never guaranteed, your money should be at less risk. This sort of return investment is mainly for the dividend, where you can earn a small percentage back and either treat it as a bonus or re-invest. Other (riskier) investments are those that have huge potential growth but might not work out. These are the ones where you could see your money disappear – but you could also see it explode into something massive. Weigh up which of these investments work for you and your outlook.

 

Consider ETFs

 

Tracker funds can combine a range of stocks in a similar industry so you can spread the risk. Generally, when the industry is doing well – so will you. These can be a good way to invest if you don’t want to get too deep into picking stocks.

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