Given the significant run up in many Technology stocks (our CEORater Tech portfolio is up 57% YTD, detail end of article), the question for many institutional investors is how best to position the portfolio for 2021?
There is a saying in Physics that “big bubbles get bigger”. Our expectation would be for Alphabet, Amazon, Apple and Microsoft shares to creep higher over the next year as retail investors continue to pour money into ETFs. However, it is difficult to justify adding to positions in many Tech names given rich valuations. Investors need to find value names that are not well understood and that have a catalyst(s) that could drive outsized operating results over the next several years. Names such as IBM and ICE come to mind.
Cloud Gaming: Sector-wise, cloud-based Gaming (Amazon Luna, Facebook Gaming, Google Stadia, Microsoft Cloud Gaming, NVIDIA GeoForce Cloud Gaming, SONY PS Now), is poised to scale over the next several decades as broadband performance improves, as game production becomes increasingly automated and as Virtual Reality eventually becomes a commonplace element of the gaming experience. If time allows we will publish our cloud gaming primer next week.
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