Saturday, May 30, 2015
The Weekend Edition is pulled from the daily Stansberry Digest. The Digest comes free with a subscription to any of our premium products.
Have you heard of "supermaterials" – the manmade, engineered materials that are stronger, tougher, lighter, and more durable than plastic, rubber, metal, and other existing materials? If you haven't heard of them yet, you will soon...
There are three supermaterials I expect to become as widely used as glass or plastic within the next five years. That offers investors the chance to get in at the bottom floor and make a lot of money from this trend.
Right now, the supermaterial getting people excited is graphene. This is the thinnest material on Earth that we've been able to create. A single layer of graphene has the thickness of one atom. But it's also the strongest material (by weight) ever measured. Depending on its purity, graphene is 40 to 100 times stronger than steel... and obviously weighs much less.
Last July, tech giant IBM announced it would invest $3 billion over the next five years to figure out how to use graphene to make semiconductors. IBM wants to use graphene to make transistors that will make computer chips 1,000 times faster and more energy-efficient than the current silicon-based ones.
So... why isn't everything made of graphene yet? Well, for one, nobody has figured out how to make large sheets of it yet. Right now, it costs $500 to produce a single gram. Meanwhile, a kilogram of aerospace aluminum costs $10. (That's $500,000 worth of graphene.)
Of course, getting the cost down was an issue for plastic in its early days, too. Research firm Allied Market Research estimates that the graphene market will reach nearly $150 million by 2020. That would reflect a growth rate of 44% within the next five years. But those estimates are based on the current cost of making graphene. When the cost goes down, the use of graphene will explode and make it a market worth billions of dollars.
Another category of supermaterials that will become a household name in the next few years is biomaterials, materials that seamlessly work with our bodies' natural biological cells and membranes. Biomaterials can mimic cells, tissue, and muscle, effectively replacing them in our bodies. Plus, they aren't foreign substances to our bodies like metal and plastic are. The global market for biomaterials should reach $115 billion by 2020, with a growth rate of more than 13%, according to biomaterials research firm Mordor Intelligence.
The third supermaterial I'm following closely is carbon fiber – a super plastic. Carbon fiber is made of long, thin strands of carbon atoms. It's 10 times stronger than steel and five times lighter. The Boeing 787 Dreamliner airplane is made of 50% carbon fiber. This frame is what makes the Dreamliner plane 20% more energy-efficient than similarly sized planes. You're going to see carbon-fiber composites used in cars and appliances as replacements for metal to make them lighter and more energy-efficient.
These supermaterials will generate huge winners in the stock market over the next five years. Some of the big winners will be the companies who make the materials. Others will be the companies who use it to make incredible new products. I'm keeping my eye on a whole group of stocks that I believe will benefit from supermaterials... and I'll soon be telling my Professional Speculator subscribers when to buy them.
Imagine walking into a restaurant and the waiter already knows what you're going to order. Walking into a Starbucks and your pumpkin-spice latte is waiting for you already. Shopping for a new pair of pants online and the website shows you only the items in your size with the colors and styles you like.
The world I'm describing is custom-made for you. And it isn't science fiction. It's an emerging trend called "Big Data," which allows for the storage of incredible amounts of data on computers... like what songs you're listening to, what stores you shop in, and more.
Over time, this huge amount of data can accurately predict behavior in things like what consumers are interested in buying. And when you can predict these things, you can anticipate their needs before they even know them.
Here's how it works: Information scientists create programs and algorithms to crawl through data around the clock with the intention of figuring out your preferences. Over time – and with more data – these programs and algorithms learn more about you and what you like. One day soon, you'll be able to automate your decisions... including what to eat and drink, what clothes to wear, and what you'll do on the weekend.
We can see early signs of Big Data already. When you browse the Internet, you see ads tailored to things you have searched for or purchased. Imagine that type of experience in the world around us... Soon, your decisions will be made for you. That's the future I envision. And if I'm right, it means certain companies will be making billions of dollars off it.
Companies investing heavily in Big Data include well-known blue-chip companies like IBM, which has a product called Watson. Watson is a computer that uses Big Data to answer questions. IBM has already signed deals to integrate Watson with consumer-products icon Apple's new smart watch.
One industry set to benefit greatly from the growth of Big Data is health care. In 2013, the U.S. spent $2.9 trillion on health care... nearly $10,000 per person. Research suggests that as much as one-third of that spending is wasteful and, worse, potentially harmful to patients. Sure enough, IBM is collaborating with health care giant Johnson & Johnson's knee- and hip-implant division. And IBM is working with Medtronic to connect heart devices, diabetes pumps, and other medical devices.
You could buy shares of IBM to gain exposure to this long-term megatrend. But I prefer the idea of speculating through smaller companies like Splunk, Tableau Software, Infoblox, and Neustar, who are working to create cutting-edge applications using Big Data.
And my Professional Speculator subscribers have already invested in the future of Big Data and health care. I recommended a small company that's working to eliminate wasteful, unnecessary, and dangerous medical expenses by parsing through the huge amounts of medical data we're collecting every day.
Date Range:5/21/2015 to 5/28/2015
Date Range:5/21/2015 to 5/28/2015