AI to digitalisation and green energy: Supertrends defining investment for today and the future

AI to digitalisation and green energy: Supertrends defining investment for today and the future
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  • A rapidly changing environment has thrown up several new trends that will redefine the way the world will work, earn, and invest.
  • From technology to shifting demographics and climate change, companies and investors alike will have to be on their toes to make the most of a changing world.
  • Now, a new report has identified investment supertrends, which are long-term in nature and offer investors the opportunity to earn outsized returns.
The contours of the global economy are changing rapidly and are being shaped by factors like technology, demographics, and climate change. These changes, also known as investment supertrends, have the potential to radically change industries and companies, and offer new investment opportunities that were either small in scale or non-existent earlier.

Investment supertrends are often long-term in nature, and investors who can identify and capitalise on these trends early may be able to achieve outsized returns over time.

Many of these supertrends, especially in the technology space, evolve rapidly and keeping up with them is essential for the long-term growth of companies as well as investors.

It is worth noting that many of these supertrends are subject to risks and uncertainties, so investors should tailor their investments based on their own goals, risk profile and time horizon.

Artificial intelligence: Beyond the chatbots


Artificial intelligence has existed in different forms like chatbots for several years now, but thanks to some major breakthroughs in 2022 and 2023, AI is now at the front and centre of companies as well as countries looking to take a leap.

This is evident from the success of ChatGPT – it not only became the fastest-growing consumer application with 100 million users in two months, but its maker OpenAI saw investment from tech giant Microsoft to the tune of $10 billion.

Microsoft was also quick to embed ChatGPT into its browser and search engine, while its rival Google is rushing to bring AI to search and other services, underlining just how big an impact ChatGPT has had in the tech sector.

According to PWC, AI has the potential to generate $15.7 trillion in revenue by 2030. That is equivalent to the cumulative nominal GDP of Japan, Germany, India and the UK.

Tech giant Accenture expects AI to have the biggest impact on education (84%), accommodation & food services (74%), construction (71%), wholesale & retail (59%) and healthcare (55%) industries.

The biggest beneficiaries of the AI revolution will be companies which provide cloud infrastructure and processing power capabilities, like Microsoft and Amazon, among others.

Climate change: Green energy, metals of the future and more

Climate change is a growing concern and despite Covid-19 and the Russia-Ukraine conflict last year putting this issue on the backburner, Credit Suisse expects it to be short-lived and that the world is still on track to achieve net-zero emissions by 2050.

The International Energy Agency’s (IEA) latest projections state that renewable energy capacity will expand from 3,278 gigawatt in 2021 to 7,744 GW by 2030, and 20,290 GW by 2050.

However, increasing renewable energy capacity will require more minerals than fossil fuel-based sources, and this is where the investment theme ‘metals of the future’ comes in.

“A typical EV requires six times the mineral inputs compared to a combustion engine car, while an onshore wind farm requires nine times the mineral inputs of a gas-fired thermal power plant,” the Credit Suisse report said.

IEA projects the demand for copper to more than double from 5 million tonnes per year in 2021 to 13 million tonnes by 2030. Likewise, lithium, silicon and other rare earth elements are also expected to see a multi-fold increase in demand.

Countries rich in these resources, like Argentina, Brazil and Chile are expected to benefit the most. Additionally, recycling of these materials, which are often in limited supply or difficult to mine, will be another lucrative opportunity, according to the report.

Millennials: The digital natives

Different demographics offer different investment opportunities. For instance, a young, digital-native population has more hunger for technology than their older counterparts.

While the Gen Y and Z are digital natives, the Covid-19 pandemic has brought digitalisation to the forefront. However, despite the WHO declaring that the Covid emergency is over, Credit Suisse notes that the drivers of digitalisation are firmly in place.

Companies are increasingly adopting digital initiatives like 3D modelling, virtual try-on using augmented reality and other technologies to offer a virtual, digital-first experience to their customers. Online shopping in major economies like the US and China is already significant, accounting for 20% and 40% of the total shopping, respectively.

Millennials are not about just digital-first lives, though. According to the report, aspects like sustainable food are also a focus of Gen Y and Z. With undernourished people expected to grow in the future, those food companies which can capitalise on factors like sustainability and innovative ingredients which are cost-effective have a brighter future ahead.

The silver economy: Catering to the seniors

The world is growing older thanks to better availability of healthcare and food when compared to earlier. According to a United Nations estimate, people aged 65 and above are estimated to grow from 780 million today to 2.5 billion by 2100.

Aging populations in many countries are creating opportunities for investments in healthcare, retirement planning, and senior living facilities.

Healthcare is at the heart of the silver economy supertrend. The Covid-19 pandemic is still fresh in the minds of people, leading to an increased awareness about healthcare and insurance.

New and better healthcare solutions will always be in demand, giving pharmaceutical, biotech and medtech companies all the reasons they need to innovate. On the other hand, innovation costs money, and this reflects in rising healthcare costs. As such, it results in an increase in the demand for insurance, fulfilling a demand cycle for both healthcare as well as insurance companies.

Other needs of seniors like on-premise nurses, better living facilities are other attractive investment opportunities.

Anxious societies

Elevated inflation has driven up the cost of living across the world, and while the situation is dire in many parts of the world, it presents an attractive opportunity for companies to come up with innovative and affordable solutions.

“A French multinational retail and wholesale company said trading down accelerated in 2022, with consumers buying more private label products and promotions, but less fish or organic products,” the report said.

Other solutions like buy now pay later (BNPL), prefabricated and foldable homes are some other solutions which are expected to see increasing traction going forward, offering companies and investors alike with a high-risk but high-reward investment supertrend.


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