For many years now, there has been plenty of talk about how nanotechnology is the industry of the future and how there is plenty of money to be made by in nanomaterials.
These predictions are now becoming a reality.
But how can you invest in nanotechnology?
When one thinks of investment, it is usual to think of well-paid analysts in skyscrapers or rich people who study the markets.
However, many venture capitalists are still only testing the waters on this new technology, largely because they typically look to researchers and universities for the ‘next best thing’ to invest in.
As the analyst John Wright notes, “At research universities across the country, venture capitalists are giving presentations to graduate classes in nanoscience and taking professors to lunch.”
But this does not mean that these ideas are suitable for turning into businesses.
“Many nanotech start-ups are not yet ready for venture capital investment,” says Wright. “First, despite the enormous resources being dedicated to exploring and engineering at the nanoscale, the field is still in its infancy. Many start-up companies have just recently spun out of breakthroughs in universities and cannot reasonably expect to develop commercial products for at least seven to ten years. Even nanotech companies that can demonstrate functional products lack the ability to scale up for mass production.”
However, like any business sector, there are a few key ways for ordinary investors to deposit their money into nanotechnology, with the chance to make better than average returns. Naturally, each investment carries its own risks.
“Are there any stocks in 2021 with Amazon-sized futures?” asks Taylor Carmichael, a stocks analyst for the market journal Motley Fool. He believes there are, stating that, “A few that come to mind are small companies using nanotechnology to disrupt the healthcare and manufacturing industries.”
However, choosing the right one can be like finding a needle in a haystack. Not only will some of the best nanotech ideas fail to make success in markets, but shareholders always face the additional risk that the stock market will bear little resemblance to what is happening in the real economy. This means that while nanotechnology companies may be making healthy profits, a bear market can still wipe out any hard-fought gains.
Rather than lumping an investment into one or two single companies, many people prefer to spread their risk in a mutual fund.
As the investment experts at Zacks explain, “Investing in mutual funds is an indirect way to invest in nanotechnology. A mutual fund consists of investments in multiple stocks and other securities. Mutual funds typically consist of investments in a specific market, such as technology, biotechnology, or science research. You may be able to find a mutual fund that holds stock in several companies with nanotechnology projects or ambitions.”
Of course, the fund manager will charge a fee or commission and the investment will only be as good as their choices. Furthermore, just like holding shares in a single company, a mutual fund can also lose money if the market drops in value, even if the businesses selected for investment are themselves successful.
An alternative to stock market investment, is the purchase of bonds in a company that produces nanomaterials.
One such company that is currently issuing bonds for investors is the Czech business AG CHEMI GROUP (which sponsors this website).
AG CHEMI GROUP has more than 25 years of experience supplying raw materials to manufacturers. In the past decade, the company has seen demand for nanomaterials grow, resulting in an expansion of the product portfolio to include nanomaterials and patented nanotechnology processes.
The company already offers nanomaterial solutions in the fields of plastics and elastomers, antiviral/antibacterial suspensions, resins, and emulsions, pathogen destroying fabrics, and nanomaterial approaches for the construction industry (including a patented process for recycling building site waste into a raw material for concrete).
One key advantage of investing in nanotechnology today, is that it is already a proven product. As mentioned earlier, nanomaterials are being used in the manufacture of thousands of everyday items. This makes money placed in nanomaterial production, an investment into bricks and mortar facilities which provide products in demand for a growing market.
Investing in other technologies, such as cryptocurrencies, virtual reality, the Internet of Things, or space travel have yet to yield any true returns. Speculation has made Bitcoin-millionaires, but Bitcoins cannot be spent in any shop outside of the dark web.
“As with any investment, an investment in nanotechnology carries risk,” conclude experts at Zacks. “You will need to weigh your interest in promoting the development of nanotechnology with your desire for short- or long-term profits. You will also want to learn about the companies or institutions you invest in. Some may be entirely devoted to nanotechnology while others may perform work in many different fields at once. Online research and requesting information from each investment target directly are useful steps in deciding where, and how much, to invest.”
Wise advice indeed.
Photo credit: Engin Akyurt from Pexels, Alesia Kozik, AGCHEMIGROUP, Pexels, & cottonbro