{"id":39464,"date":"2013-06-28T20:07:38","date_gmt":"2013-06-29T00:07:38","guid":{"rendered":"http:\/\/countingpips.com\/forex-news\/?p=39464"},"modified":"2013-06-28T20:23:34","modified_gmt":"2013-06-29T00:23:34","slug":"why-technology-is-the-most-exciting-industry-in-the-world","status":"publish","type":"post","link":"https:\/\/www.investmacro.com\/forex-news\/2013\/06\/28\/why-technology-is-the-most-exciting-industry-in-the-world\/","title":{"rendered":"Why Technology is the Most Exciting Industry in the World"},"content":{"rendered":"<p>By <a href=\"http:\/\/www.MoneyMorning.com.au\" target=\"_blank\"><u>MoneyMorning.com.au<\/u><\/a> <\/p>\n<p>Today&rsquo;s <em>Money Weekend <\/em>takes a break from normal  operations so we can bring you an exciting discussion on Port Phillip  Publishing&rsquo;s latest investment service: <em>Revolutionary  Tech Investor. <\/em><\/p>\n<p>Editors Kris  Sayce and Sam Volkering sat down with us for a chat about living through this  fascinating period in technology and business.&nbsp;  The insights, perils and potential profits for investors are plenty, so  please enjoy&hellip;.<\/p>\n<p align=\"center\"><img decoding=\"async\" src=\"http:\/\/www.moneymorning.com.au\/images\/mmw20130629a.jpg\"><br \/>\n  <strong>Left to Right: Sam Volkering, Callum Newman, and Kris Sayce<\/strong><\/p>\n<p><strong>Callum: You guys have just launched  your new service <em>Revolutionary Tech  Investor. <\/em>Why now?<\/strong><\/p>\n<p><strong>Kris:<\/strong> Any time is a great time to invest  in revolutionary tech stocks. But that&rsquo;s even more so now. The world is at the  cusp of a new technological revolution that&rsquo;s set to deliver untold benefits to  the human race.<\/p>\n<p>Right now we  don&rsquo;t know what all of those benefits will be. It&rsquo;s almost impossible to  accurately predict the future. However, we can make some educated guesses based  on history and on the trends we see happening now.<\/p>\n<p>For  instance, one of the more outlandish predictions is for the human race to  conquer space. And I don&rsquo;t just mean the odd trip up and back&hellip;or sending probes  millions of miles into space.<\/p>\n<p>I&rsquo;m talking  about tourist travel into space. I&rsquo;m talking about commercial enterprises being  established in space, such as asteroid mining companies. And if you think that  sounds ridiculous, Sam recently spoke to the managing director of an Aussie  firm that plans to mine some of the resource rich giant rocks that zoom past  the Earth every year.<\/p>\n<p>But we&rsquo;re  not just looking at the big and brash projects, we&rsquo;re looking at the small  projects too &mdash; the medical and technological advances that are taking place at  the molecular level. Specifically the work scientists are doing with stem cells  and DNA.<\/p>\n<p>When you get  down to that level the innovations are mind-boggling, such as the potential for  doctors to grow and repair damaged tissue or replace organs without the need  for patients to go on lengthy and often futile waiting lists. That&rsquo;s  revolutionary.<\/p>\n<p><strong>Sam:<\/strong> That&rsquo;s right. We&rsquo;re really at the  doorstep of a huge shift in the way civilisation operates. We&rsquo;re talking  massive leaps in biotechnology, robotics, molecular technology, energy,  computing, all happening now and increasing at unbelievable speed over the next  few years. That&rsquo;s why now is the right time to find out what are the best  companies to be involved in for this upcoming revolutionary period.<\/p>\n<p><strong>Callum: As far as we know, there&rsquo;s no  service like this in Australia. What should subscribers expect from RTI?<\/strong><\/p>\n<p><strong>Kris:<\/strong> Most analysts and research firms  have a two-dimensional view of Aussie investors. They assume that because the  Aussie market is dominated by banking and resource stocks, that&rsquo;s all Aussie  investors are interested in.<\/p>\n<p>Our feedback  shows us that&rsquo;s not true. I&rsquo;ve lost count of the number of comments I&rsquo;ve  received from readers saying this is just the type of service they&rsquo;ve been  waiting for.<br \/>\n  As for what  investors can expect, that&rsquo;s easy. It&rsquo;s Sam and my role to search the entire  investing world for companies that are involved in revolutionary breakthroughs.<\/p>\n<p>That&rsquo;s an  important point. This service won&rsquo;t recommend big blue-chip companies that have  already gained market dominance. So you won&rsquo;t see a tip for Google, Facebook or  IBM &mdash; not unless these firms come up with a genuinely revolutionary new product  that could transform their business.<strong> <\/strong><\/p>\n<p><strong>Sam:<\/strong> We&rsquo;re bringing to readers a  viewpoint that too many don&rsquo;t have in the Australian marketplace: a positive  outlook. Technology and innovation drive the advancement of civilisation; we&rsquo;re  looking at the here and now, but also for trends and technologies that will  shape our future. The work we&rsquo;re doing is looking for technologies that will  make lives better and bring something to the world that&rsquo;s never been done. That&rsquo;s  why it&rsquo;s <em>Revolutionary Tech Investor<\/em> not Same-Same-But-Different Tech Investor.<\/p>\n<p><strong>Kris:<\/strong> Not only that, but contrary to  belief, the Aussie market is rich with revolutionary stocks. Sure, the depth  isn&rsquo;t what it is on the US market, but there are many opportunities right here.  Our first issue of <em>Revolutionary Tech  Investor<\/em> highlighted this by recommending a stock that is set to be the  global market leader in its field.<strong> <\/strong>&nbsp;<strong> <\/strong><\/p>\n<p><strong>Callum: Can you elaborate on how you  think Australia compares to the USA?<\/strong><\/p>\n<p><strong>Sam:<\/strong> Sure. Australia sits in an  interesting position. We&rsquo;ve got great schools and universities, some fantastic  scientists and researchers. We have some of the preeminent minds in medicine  and medical research globally. But Australia has a problem of converting breakthroughs  into commercial opportunities. There&#8217;s a fair share of great technology  companies in Australia, and we&rsquo;re doing our best to uncover them. But certainly  we don&rsquo;t have the depth of the US in this space. <\/p>\n<p>But  hopefully over the coming years that will all shift as (hopefully) leaders of  our country realise the full potential for this country to be a global leader  in technology. PriceWaterhouseCoopers recently did a study for Google Australia  on this. One of their findings was, and I quote, &lsquo;<em>Australia has one of the best regulatory environments for  entrepreneurship, and an engaged and strengthening culture of inclusion and  openness. <\/em><br \/>\n    <em>However, we have a considerably  higher &lsquo;fear of failure&rsquo; rate than many other innovative countries (e.g. US  &amp; Canada) which is constraining the growth of our tech start-up sector.<\/em>&rsquo;<\/p>\n<p>However the  report also found that the technology, entrepreneurship and innovation could  contribute over 500,000 jobs and over 4% of GDP to the economy over the coming  years if enough time and resource goes into developing our brilliant minds and  technological capabilities.<\/p>\n<p><strong>Kris:<\/strong> Let&rsquo;s hope so. But right now Sam and  I have identified a number of tech and biotech stocks on the Aussie market that  are worth running our slide rule over. We&rsquo;ve already recommended what we  believe is the best Aussie biotech company, and we&rsquo;re now researching and  analysing others for upcoming issues of <em>Revolutionary  Tech Investor<\/em>.<\/p>\n<p>But also  remember that this is an investment service without borders. Today it&rsquo;s much  easier to invest in international markets than it was even just five years ago.  While most of our focus will be on the Aussie market, if we see a revolutionary  opportunity on a foreign market we&rsquo;ll look there too.<\/p>\n<p>If investors  want to make the most out of their returns they&rsquo;ve got to look at expanding  their exposure to non-Aussie markets. That means looking at overseas technology  stocks and other sectors. It&rsquo;s also a great way to protect your wealth against  a falling Aussie dollar &mdash; as the Aussie dollar falls the value of your foreign  assets should rise (all else being equal).<\/p>\n<p><strong>Callum: Your first report had some fascinating  research.&nbsp; Can we expect this in every  RTI issue?<\/strong><\/p>\n<p><strong>Kris:<\/strong> Of course. The name of the service  sets a high benchmark. [Laughs] Whenever we&rsquo;re researching a stock it reminds  us that we need to look for revolutionary tech stories.<br \/>\n  It&rsquo;s a great  reminder to eschew mundane and everyday tech stories so that we can focus on  the truly revolutionary stories.<\/p>\n<p>During our  weekly meetings Sam and I will discuss a number of opportunities. Almost all of  them are great companies, but at the end of each discussion we ask a simple  question of each stock &mdash; is it revolutionary? This usually results in us  filtering out at least half of the stocks we&rsquo;ve discussed.<\/p>\n<p>It&rsquo;s not  that the companies are bad, it&rsquo;s just that they don&rsquo;t meet the criteria. And if  a stock doesn&rsquo;t meet the criteria of being revolutionary then it&rsquo;s not likely  investors will achieve the kind of big returns they&rsquo;re looking for.<\/p>\n<p><strong>Sam:<\/strong> The most important thing is to  understand the technology, its real world application and the trends of the  next 10 years. So we&rsquo;re drilling into the technology, the science behind the  technology, the people behind the science to get a real understanding for  what&rsquo;s going on, what it means for the world and where it&rsquo;s heading. <\/p>\n<p><strong>Callum: OK. One point. &lsquo;Technology&rsquo;  is a pretty broad term. What trends are you focusing on?<\/strong><\/p>\n<p><strong>Kris:<\/strong> That&rsquo;s a great question. You can  split this into two subgroups: computerised technology and biological  technology. The first is obviously has to do with bits and bytes, the type of  technological advances that rely on computing innovations.<\/p>\n<p>The other &mdash;  biological technology &mdash; is to do with the human aspect. This includes  biotechnology firms&hellip;companies that doing things to help improve your health  such as extending your life or helping to repair body parts and tissues  biologically rather than with prosthetics or transplants.<\/p>\n<p><strong>Sam: <\/strong>Yeah,<strong> <\/strong>one of the biggest trends we&rsquo;re seeing is the nano-isation of  things. By that I mean everything is going Nano sized, less than the width of a  human hair. Whether it&rsquo;s computing, medicine or robotics, things are more  complex on a smaller level than ever before.<strong><\/strong><\/p>\n<p><strong>Kris:<\/strong> As Sam says, the nano-isation of  technology is a key feature of our early research. I highlight some of these in  the <em>Sixth Revolution<\/em> report. To take  one part of that report, I talk about mind over matter and the ability in the  near future for scientists to cure diseases before they happen. And I don&rsquo;t  mean through vaccinations which involve giving the patient the disease to  improve immunity, I&rsquo;m talking about scientists &lsquo;hacking in&rsquo; to the genetic  make-up of your body and flipping a switch to make sure you never get a  particular &mdash; or any &mdash; disease.<\/p>\n<p align=\"center\"><img decoding=\"async\" src=\"http:\/\/www.moneymorning.com.au\/images\/mmw20130629b.jpg\"> <\/p>\n<p>Or there&rsquo;s  the potential for scientists to grow replacement body parts or organs in a  laboratory and then transfer them to the patient. Unlike normal transplants it  doesn&rsquo;t need a donor patient to die, or in the case of kidney transplants  leaving the donor vulnerable with just one kidney. <\/p>\n<p>In fact the  way science is going medical donors as you know them today will cease to exist.  In the future donors will simply donate a key &lsquo;nutrient&rsquo; from their body  without leaving them in a weakened or adverse state. This is set to be a major  revolutionary breakthrough for the healthcare industry and for the health of  everyone.<\/p>\n<p><strong>Sam:<\/strong> Kris and I agree that we&rsquo;re seeing  everything being connected, too. You might hear us refer to it as the  &lsquo;Integrated World&rsquo;. It means literally everything you come into contact with on  a daily basis will be linked and be able to &lsquo;talk&rsquo; with everything else. It&rsquo;s  an interconnected world like we&rsquo;ve never seen before. <\/p>\n<p><strong>Callum:<\/strong> <strong>And  that flows onto a world of unprecedented data right?<\/strong><\/p>\n<p><strong>Sam:<\/strong> That&rsquo;s right. There&rsquo;s so much data  being created, collected and communicated that it all needs interpretation to  make sense of it all. So what you see is that one trend affects another which  affects another. It&rsquo;s a shift in how society interacts and operates with each  other and their surroundings. <\/p>\n<p>The other  thing that&rsquo;s going to turn our world on its head in the coming future is Space.  I have no doubt as Space is commercialised entire new industries will be  created. <\/p>\n<p>There will  be an abundance of new jobs and opportunities as we start to treat space as a  stepping stone out into our solar system and the further galaxies. I was just  last week talking to the Director of Mining and Processing of an Asteroid  Mining company. And from what we talked about I&rsquo;ve never been more excited  about the potential the commercialisation of Space holds for the world.<\/p>\n<p><strong>Callum: The big picture stuff is  awesome but great technology doesn&rsquo;t mean a great company. What are the key  things you&rsquo;ll be looking for?<\/strong><\/p>\n<p><strong>Kris:<\/strong> Sam wrote a great article about this  recently so I&rsquo;ll leave it up to him to explain it. But in short, just because a  company has a great technology it doesn&rsquo;t mean it will be successful. For  example, Apple didn&rsquo;t invent the smart phone. Nokia has designed and built a  fully functional smart phone in the late 1990s. But it never went anywhere  because they didn&rsquo;t have the vision to market it at that time.<\/p>\n<p>Also, it was  just the wrong time. The internet was still in its infancy and mobile phones  were just that, a phone that was mobile. The idea that a mobile phone would  someday become a portable entertainment device was almost unthinkable back  then.<\/p>\n<p><strong>Sam:<\/strong> You&rsquo;re right Kris, it is a good  question. The crucial need for a great tech company is a game changing  technology and the ability to sell it to a big enough market. <\/p>\n<p>We&rsquo;re  looking at companies that have great technology, an unmet market and the  ability to tap that market. Importantly, the people that drive the company are  almost more crucial to making a great company than a great technology. Think  Gates, Jobs, Page &amp; Brin, Musk, Branson. These are visionaries that inspire  and create great things. <\/p>\n<p><strong>Callum: Yeah, and tech companies can  sell to a global market. What are the potential returns from this sector?<\/strong><\/p>\n<p><strong>Kris:<\/strong> That&rsquo;s another great question  Callum. The returns for revolutionary technology stocks can vary. Take Apple as  an example. Today it&rsquo;s not a revolutionary company, but ten years ago it was.  If you had bought Apple shares in 2003 and held them until today you would have  clocked up a 4,093% gain.<\/p>\n<p>That&rsquo;s a  pretty good return by anyone&rsquo;s standards. [Laughs] Of course, I can&rsquo;t guarantee  every stock we recommend will bag a big return like that. And in reality in  some instances we may look for more modest gains such as 100%, 200% or 500%.<\/p>\n<p>The expected  returns really depend on the company and its ability to engage the market at  the right time. If a company is too early or too late in meeting consumer  demand it can mean the stock price missing out on its full potential. But if  the company gets the timing dead right then triple- or even quadruple-digit  percentage gains are possible.<\/p>\n<p><strong>Sam:<\/strong> That&rsquo;s right. There are some  companies that have seen returns over the years in excess of 10,000%. I mean go  back to March 1986 to now, look at Adobe over 19,800%. Apple of course, over  12,900% in the same time frame, Microsoft over 33,300%. These are companies  that in just 27 years have made ridiculous returns, but they&rsquo;re all real.&nbsp; <\/p>\n<p><strong>Callum: Of course, but we also had  the tech bubble. What are the major risks to investing in tech stocks?<\/strong><\/p>\n<p><strong>Sam:<\/strong> Waiting is one. Take those 3 stocks  above. If you&rsquo;d have waited until January 1995 to invest you&rsquo;d now be seeing  returns of 1,072% [ADBE], 4,028% [AAPL] and 789% [MSFT]. Now that&rsquo;s nothing to  shy away from, but you get the point. <\/p>\n<p><strong>Kris:<\/strong> There&rsquo;s no secret to this. All stock  investments are risky so tech stocks are no different in that respect. Just as  a high street retailer can fail by not understanding its market, a tech stock  can fail by not understanding its market.<\/p>\n<p>The  difference is that investors tend to have higher expectations for tech stocks  than they do for other companies. You usually see this reflected in a higher  price to earnings ratio. Investors always price technology stocks for growth,  so if the company doesn&rsquo;t meet those expectations the stock price can take a  big drubbing.<\/p>\n<p>By contrast,  investors tend to have lower growth expectations for retail stocks so you tend  to see lower PE ratios and share prices that don&rsquo;t climb as high.<\/p>\n<p>But really  it comes back to what I said before. The big risk for tech stocks is that the  company doesn&rsquo;t understand its market or gets the timing wrong. Competition can  also hurt an unprepared company. In saying that, competition is also a positive  as it confirms to a company that it&rsquo;s on the right track.<\/p>\n<p><strong>Sam:<\/strong> I&rsquo;m sure Kris would agree that the  other major mistake people make is not properly understanding the technology  and its real world application. It comes back to maybe having a great technology  but not having anyone to sell it to. Likewise you might think a company has  great technology but it&rsquo;s really just mutton dressed as lamb. You need to dig  in and understand the technology, the science and it potential to change the  world or at least be sold to lots of people.<\/p>\n<p><strong>Callum: You touched on it earlier,  but what kind of timeframe do tech investors need to factor in for RTI&rsquo;s  strategy?<\/strong><\/p>\n<p><strong>Kris:<\/strong> That&rsquo;s one of the beauties of  investing in revolutionary technologies. You can never know for certain when  the big revolutionary changes will happen. In some cases we&rsquo;re looking at a  6&ndash;12 month timeframe, in other cases it&rsquo;s a long-term trend that may not play  out for 5&ndash;10 years.<\/p>\n<p>I think of  the Industrial Revolution as an example. Most historians pinpoint the start of  the Industrial Revolution around 1750. For the capitalists who invested in the  new iron, milling and manufacturing companies in the immediate years leading up  to 1750 they could have made a lot of money.<\/p>\n<p>But think  about the capitalists who had visions about an Industrial Revolution in the  1710s or 1720s. They had a lot longer to wait in order to get a return on their  investment.<br \/>\n  So where are  we today? Are we in &lsquo;1710&rsquo; or &lsquo;1749&rsquo;? Based on the research we&rsquo;re doing and the  companies and ideas we&rsquo;re digging up, I have no hesitation saying we&rsquo;re  currently living through &lsquo;1749&rsquo; all over again.<\/p>\n<p><strong>Sam:<\/strong> Remember, revolutions don&rsquo;t happen  overnight. They happen progressively and sneak up on you until one day you  realise it&rsquo;s just a natural part of life. That&rsquo;s kind of how Google has found  their way to the pinnacle of the internet. Most people struggle to remember  what the internet was like before Google was around.<\/p>\n<p><strong>Callum: Yeah. [Laughs] Speaking of  Google, will RTI be looking at companies with existing operations and cashflow  or more speculative plays? Or both?<\/strong><\/p>\n<p><strong>Sam:<\/strong> Both. Our main focus is on the  technology and the potential it has. It&rsquo;s a similar mind set to how companies  are built in Silicon Valley. If you&rsquo;ve got a compelling idea\/technology and  it&rsquo;s genuinely good enough then it&rsquo;s easy to build a business around. The hard  part is the right technology and the idea. If it&rsquo;s good enough it will sell  itself. And you can look at companies like Atlassian and Palantir that  perfectly illustrate that great technology sells itself.<\/p>\n<p><strong>Kris:<\/strong> It sure does. We&rsquo;re not just looking  at brand new start-up companies. We&rsquo;re also looking at companies that may be  established but which are only now tapping into a new trend.<\/p>\n<p>A perfect  example is one of our US stock tips. This is a 100+ year-old company (hardly a  dot-com start-up) that is developing leading-edge revolutionary technology.<\/p>\n<p>It&rsquo;s one of  the few examples of an established market leading company that has positioned  itself to take advantage of a new technological boom. Most established  companies in other industries are more interested in protecting their existing  market share rather than looking to establish an entirely new market. Not this  company.<\/p>\n<p><strong>Callum: Are tech stocks volatile like  resource shares can be?<\/strong><\/p>\n<p><strong>Kris:<\/strong> Well, there are some similarities. A  junior resource company typically has all its eggs in one basket. It&rsquo;s  investing in uncovering a resource that could make the company and its  investors millions or billions of dollars combined. But if the resource company  doesn&rsquo;t uncover the resource they&rsquo;re looking for it can have a bad impact on  the share price. Resource stocks tend to rise and fall on any given day based  on investor confidence of whether the company can find the resource.<\/p>\n<p>As for tech  stocks, they tend to have all their eggs in one basket too. They&rsquo;re investing  in creating a product or service that could make the company and its investors  millions or billions of dollars combined. But if the tech company gets the  consumer mood or demand wrong it can have a bad impact on the share price. Like  resource stocks, tech stocks can rise and fall on any given day based on  investor confidence. So yes, they are similar. Resource stocks are hostage to  commodity prices while tech stocks are hostage to consumer demand. Both can be  fickle at times!<\/p>\n<p><strong>Sam:<\/strong> Biotech stocks, absolutely. Like  resource stocks they often &lsquo;bet the house&rsquo; on one particular  technology\/cure\/treatment. If it gets knocked down by the FDA or poor clinical  trials are released, then you can see a company go from hero to zero overnight.  Something like software and computing is a bit different. <\/p>\n<p align=\"center\"><img decoding=\"async\" src=\"http:\/\/www.moneymorning.com.au\/images\/mmw20130629c.jpg\"> <\/p>\n<p>By the time  it gets to market it&rsquo;s a proven technology, so then it&rsquo;s about securing  contracts and sales. That tends to mean not as high volatility but still  typical risks of any listed stock. The thing is there isn&rsquo;t a regulatory body  that will say &lsquo;no you&rsquo;re software is crap&rsquo;, and stop it from being sold. It  tends more to be industry related performance, not regulatory related.<\/p>\n<p><strong>Callum: Right, I see. You&rsquo;ve said  that RTI will hunt all over the globe for opportunities. Does that mean buying  stocks listed overseas?<\/strong><\/p>\n<p><strong>Kris: <\/strong>Some of the stock tips will be  overseas companies, but I expect most of them to be Aussie stocks. However,  it&rsquo;s important that investors have exposure to non-Aussie assets. Buying  foreign shares is one of the easiest ways to do it&hellip;certainly easier than buying  property overseas.<\/p>\n<p>There are  two ways to get exposure to foreign stocks. The first is to open a US brokerage  account. Commsec, ETrade and Westpac Online Broking all offer this service at  reasonable rates.<strong> <\/strong><\/p>\n<p><strong>Sam:<\/strong> The downside of the Australian  market is it&rsquo;s just a speck in the ocean. There&rsquo;s an abundance of Australian  stocks, but we all know the Aussie market makes up about 2% of global markets.  There&rsquo;s so much more happening outside of Australia we couldn&rsquo;t just look  domestically all the time or we&rsquo;d miss out on pioneering technologies  elsewhere. Again, that&rsquo;s not to say there aren&rsquo;t opportunities in Australia,  it&rsquo;s just there aren&rsquo;t as many when you look at the US, London or Hong Kong.  Again our search is for Revolutionary Technology. And that means looking offshore  sometimes.<\/p>\n<p><strong>Kris: <\/strong>I&rsquo;ll add another option is to invest  using contracts for difference (CFDs). Not every stock we tip will be available  as a CFD &mdash; two of the four current stock tips can be traded as a CFD. And CFDs  have their own set of risks that you don&rsquo;t have as a share investor. If you  decide to use CFDs just make sure you check out the risks. Reputable firms like  IG and CMC Markets provide prospective clients with thorough information  guides.<\/p>\n<p><strong>Callum: There&rsquo;s one thing investors  might like to know. Are traditional financial ratios any use with technology  stocks?<\/strong><\/p>\n<p><strong>Kris:<\/strong> Yes. Anything that lets you compare  one stock with another is useful. However (and this may surprise you), the  financial condition of a company is the last thing we look at when analysing  revolutionary technology companies.<\/p>\n<p>When you&rsquo;re  looking at big trends that could happen over the next 5, 10 or 15 years,  looking at the current balance sheet or income statement is almost irrelevant.  In fact, it can be a hindrance. Knowing that a company has falling revenue,  debt or that it quickly burns cash can cloud our vision of the big picture.<\/p>\n<p><strong>Callum:<\/strong> OK.<strong> <\/strong><\/p>\n<p><strong>Kris:<\/strong> I&rsquo;m not saying we don&rsquo;t look at  these things, it&rsquo;s just about prioritising things. If we look at the financials  first, there&rsquo;s a danger we could disregard the company without having looked at  it in detail.<\/p>\n<p>By looking  at the technology and the opportunity first it reduces our risk of discarding a  potentially revolutionary company due to current (and perhaps irrelevant)  financials. Once companies make the first few cuts and we&rsquo;re left with a  shortlist of about five stocks, then we&rsquo;ll consider the financials.<\/p>\n<p><strong>Sam:<\/strong> Take Tesla motors for instance.  Their market cap is a tick over $12 billion dollars and they&rsquo;ve only just  turned a profit last quarter. Their P\/E ratio is somewhere just north of 800  times.<\/p>\n<p>Now that  makes no sense, does it? You&rsquo;d be terrified of a P\/E at that level. But they&rsquo;ve  just paid back a US government &lsquo;green&rsquo; loan, they&rsquo;ve turned a profit, sales are  picking up, they&rsquo;re innovating like mad-men and it&rsquo;s estimated their revenues  will grow to over $3 billion by 2015. The technology they have is changing the  entire auto industry so the share price is a reflection of that, not  necessarily their current financial performance.<\/p>\n<p><strong>Callum: Economist Joseph Schumpeter  coined the phrase &lsquo;creative destruction&rsquo; to describe how capitalism drives  change.&nbsp; RTI will obviously focus on the  companies creating wealth but will it suggest companies likely to be hit  negatively by developments in the tech space, like newspapers for example?<\/strong><\/p>\n<p><strong>Kris:<\/strong> If you&rsquo;re asking if we&rsquo;ll recommend  short-selling stocks then I would say no. Short selling from a fundamental  angle involves just as much effort as recommending stocks to buy. And with so  many revolutionary stocks on the market, I&rsquo;d rather stick to analysing the  positive and potentially ground-breaking technologies that could make investors  a lot of money.<\/p>\n<p>Besides,  when you short sell your maximum possible gain is to double your money if the  stock goes to zero. More likely you&rsquo;ll only make between 20-60% as most short  sellers get out of a trade long before the firm goes bust. So when you compare  the potential returns of short selling dinosaur stocks with buying  revolutionary stocks, it&rsquo;s a no-brainer.<\/p>\n<p>Also,  picking a dying industry and betting against it isn&rsquo;t as easy as it sounds.  Punters who short-sold the New York Times Company at almost any point over the  last two years are sitting on losses today. We may look at short selling in the  future, but at this point the numbers just don&rsquo;t stack up.<\/p>\n<p><strong>Callum:<\/strong> <strong>Your  thoughts Sam?<\/strong> <\/p>\n<p><strong>Sam:<\/strong> We&rsquo;ll highlight the companies we  think are opportunities and great investment options. That means we&rsquo;ll be  looking at competitors and discounting them. We&rsquo;re looking at the bigger  picture when it comes to the technology and the industry they operate in  because with revolutionary tech comes a change and attitude in how industry  operates. <\/p>\n<p align=\"center\"><img decoding=\"async\" src=\"http:\/\/www.moneymorning.com.au\/images\/mmw20130629d.jpg\"> <\/p>\n<p>We want game  changers not run-of-the-mill companies. For instance, to touch on Tesla again,  if we think that&rsquo;s a winner, then we&rsquo;re talking about a potential future of  cars not needing petrol&hellip;ever. That has a flow on effect for oil companies and  combustion engine manufacturers doesn&rsquo;t it? Likewise, green energy and advances  in things like solar, wind and geothermal power mean bad long term news for oil  companies.<\/p>\n<p>I&rsquo;m not  saying oil companies will cease to exist, but in the future it will be a  different world to what we&rsquo;re all used to. That&rsquo;s what we mean when we say  we&rsquo;re on the doorstep of a new era, and new age. Things will be vastly  different to what you see now, and that in itself will bring opportunities like  never seen before.<\/p>\n<p><strong>Callum:<\/strong> <strong>So  Kris, where can people find out more about <em>Revolutionary  Tech Investor<\/em>? <\/strong><\/p>\n<p><strong>Kris:<\/strong> Investors should check out the <a href=\"http:\/\/pro1.portphillippublishing.com.au\/128684\/\" target=\"_blank\"><em>Sixth Revolution<\/em><\/a> report. I&rsquo;m sure you&rsquo;ll provide a  link to this report when you print a copy of this transcript. In that report  investors can find out about what I believe is the beginning of the biggest  wealth-creating opportunity in human history. It also includes the four stocks  that are perfectly placed to take advantage of this new monster trend.<\/p>\n<p><strong>Callum:<\/strong> Sure, I&rsquo;ll make sure we link to that  report. Until then, this has been great. Thanks for your time guys.<\/p>\n<p>[<strong>Ed note:<\/strong> To get your hands on Kris&rsquo;  Sixth Revolution special report <a href=\"http:\/\/pro1.portphillippublishing.com.au\/128684\/\" target=\"_blank\">click here<\/a>. You&rsquo;ll read why the world is on the  cusp of the biggest wealth-creating opportunity in human history and how it  could transform <a href=\"http:\/\/pro1.portphillippublishing.com.au\/128684\/\" target=\"_blank\">your  life, your health, your wealth and your future&hellip;<\/a>&nbsp;]<\/p>\n<p><strong>Callum Newman<a href=\"https:\/\/plus.google.com\/u\/7\/113805451050351871502\/about\" target=\"_blank\">+<\/a><\/strong><br \/>\n    <strong>Editor, <em>Money Weekend<\/em> <\/strong><strong> <\/strong><\/p>\n<p><strong><em>From the Archives&hellip;<\/em><\/strong><\/p>\n<p>\n  <a href=\"http:\/\/www.moneymorning.com.au\/20130621\/the-12-most-important-rules-every-investor-must-know.html\" title=\"Permanent Link to The 12 Most Important Rules Every Investor Must Know\">The 12 Most  Important Rules Every Investor Must Know<\/a> <br \/>21-06-2013 &ndash; Vern Gowdie <\/p>\n<p><a href=\"http:\/\/www.moneymorning.com.au\/20130620\/the-us-economy-butterfly-effect.html\" title=\"Permanent Link to The US Economy Butterfly Effect\">The US Economy Butterfly Effect<\/a><br \/>20-06-2013 &ndash; Murray Dawes <\/p>\n<p><a href=\"http:\/\/www.moneymorning.com.au\/20130619\/beware-the-federal-reserves-deadly-game-of-poker.html\" title=\"Permanent Link to Beware The Federal Reserve&rsquo;s Deadly Game of Poker\">Beware  The Federal Reserve&rsquo;s Deadly Game of Poker<\/a><br \/>19-06-2013 &ndash; Dr Alex  Cowie <\/p>\n<p><a href=\"http:\/\/www.moneymorning.com.au\/20130618\/why-thursday-could-be-a-key-day-for-silver.html\" title=\"Permanent Link to Why Thursday Could Be a Key Day for Silver&hellip;\">Why Thursday Could Be a Key Day for Silver&hellip;<\/a><br \/>18-06-2013 &ndash; Dr Alex  Cowie <\/p>\n<p><a href=\"http:\/\/www.moneymorning.com.au\/20130617\/the-single-biggest-mistake-a-technology-investor-can-make.html\" title=\"Permanent Link to The Single Biggest Mistake a Technology Investor Can Make\">The Single Biggest Mistake a Technology  Investor Can Make<\/a> <br \/>\n  17-06-2013 &ndash; Sam Volkering <\/p>\n<div class=\"feedflare\">\n<a href=\"http:\/\/feeds.feedburner.com\/~ff\/MoneyMorningAustralia?a=boeZF51J6HU:40RpRc9CTPI:yIl2AUoC8zA\"><img decoding=\"async\" src=\"http:\/\/feeds.feedburner.com\/~ff\/MoneyMorningAustralia?d=yIl2AUoC8zA\" border=\"0\"><\/img><\/a> <a href=\"http:\/\/feeds.feedburner.com\/~ff\/MoneyMorningAustralia?a=boeZF51J6HU:40RpRc9CTPI:V_sGLiPBpWU\"><img decoding=\"async\" src=\"http:\/\/feeds.feedburner.com\/~ff\/MoneyMorningAustralia?i=boeZF51J6HU:40RpRc9CTPI:V_sGLiPBpWU\" border=\"0\"><\/img><\/a> <a href=\"http:\/\/feeds.feedburner.com\/~ff\/MoneyMorningAustralia?a=boeZF51J6HU:40RpRc9CTPI:gIN9vFwOqvQ\"><img decoding=\"async\" src=\"http:\/\/feeds.feedburner.com\/~ff\/MoneyMorningAustralia?i=boeZF51J6HU:40RpRc9CTPI:gIN9vFwOqvQ\" border=\"0\"><\/img><\/a>\n<\/div>\n<p><img loading=\"lazy\" decoding=\"async\" src=\"http:\/\/feeds.feedburner.com\/~r\/MoneyMorningAustralia\/~4\/boeZF51J6HU\" height=\"1\" width=\"1\" \/><\/p>\n","protected":false},"excerpt":{"rendered":"<p>By MoneyMorning.com.au Today&rsquo;s Money Weekend takes a break from normal operations so we can bring you an exciting discussion on Port Phillip Publishing&rsquo;s latest investment service: Revolutionary Tech Investor. Editors Kris Sayce and Sam Volkering sat down with us for a chat about living through this fascinating period in technology and business.&nbsp; The insights, perils &hellip; <\/p>\n<p class=\"link-more\"><a href=\"https:\/\/www.investmacro.com\/forex-news\/2013\/06\/28\/why-technology-is-the-most-exciting-industry-in-the-world\/\" class=\"more-link\">Continue reading<span class=\"screen-reader-text\"> &#8220;Why Technology is the Most Exciting Industry in the World&#8221;<\/span><\/a><\/p>\n","protected":false},"author":1,"featured_media":0,"comment_status":"closed","ping_status":"closed","sticky":false,"template":"","format":"standard","meta":{"footnotes":""},"categories":[],"tags":[],"class_list":["post-39464","post","type-post","status-publish","format-standard","hentry"],"_links":{"self":[{"href":"https:\/\/www.investmacro.com\/forex-news\/wp-json\/wp\/v2\/posts\/39464","targetHints":{"allow":["GET"]}}],"collection":[{"href":"https:\/\/www.investmacro.com\/forex-news\/wp-json\/wp\/v2\/posts"}],"about":[{"href":"https:\/\/www.investmacro.com\/forex-news\/wp-json\/wp\/v2\/types\/post"}],"author":[{"embeddable":true,"href":"https:\/\/www.investmacro.com\/forex-news\/wp-json\/wp\/v2\/users\/1"}],"replies":[{"embeddable":true,"href":"https:\/\/www.investmacro.com\/forex-news\/wp-json\/wp\/v2\/comments?post=39464"}],"version-history":[{"count":0,"href":"https:\/\/www.investmacro.com\/forex-news\/wp-json\/wp\/v2\/posts\/39464\/revisions"}],"wp:attachment":[{"href":"https:\/\/www.investmacro.com\/forex-news\/wp-json\/wp\/v2\/media?parent=39464"}],"wp:term":[{"taxonomy":"category","embeddable":true,"href":"https:\/\/www.investmacro.com\/forex-news\/wp-json\/wp\/v2\/categories?post=39464"},{"taxonomy":"post_tag","embeddable":true,"href":"https:\/\/www.investmacro.com\/forex-news\/wp-json\/wp\/v2\/tags?post=39464"}],"curies":[{"name":"wp","href":"https:\/\/api.w.org\/{rel}","templated":true}]}}