Healthcare innovation delivered powerful vaccines with astonishing speed. Policymakers and corporations remain committed to investment in climate change mitigation. We think these trends will continue to drive research and development, investment and value creation. In recent years, innovations emerged in e-commerce, tech hardware and cloud computing. E-commerce spending is 20% higher than it was before the pandemic and global spending on cybersecurity for cloud computing grew at a 40% pace in 2021.
In the coming years, we expect digital transformation of the economy to continue apace. Automation both in goods-producing and service industries will likely increase, possibly catalyzed by shortages in the labor market. Artificial intelligence and machine learning will continue to enable new technologies such as voice assistants and autonomous driving.
When assessing the opportunity among these three megatrends, we believe it’s critical to diversify across regions, investment styles and sectors. We can also focus on megatrend enablers: cybersecurity, artificial intelligence, cloud computing and semiconductors. A new era of automation not only holds promise for well-positioned portfolios, but could also lead to higher productivity growth across the economy.
Before considering what changes might make the most sense for your portfolio, we recommend that you first take stock of how you’re currently positioned and confirm what your portfolio needs to do for you, your family and your community. Are your assets earmarked for your lifestyle? Your legacy? Intended to grow in perpetuity? Or do you need access to them in the near term? As you consider our outlook on the New Year, remember that your own portfolio positioning should reflect a goals-based plan, investing framework and risk tolerance.
