Robotics and Artificial Intelligence
Computers keep getting cheaper to the point in 2-5 years many people will be able to afford a supercomputer with multiple ultra high-speed connections to the internet. Coupled with this artificial intelligence (AI) continues to improve and is also becoming more affordable. What’s all that mean?
As robotics improve many companies will want to replace costly personnel with robots. The companies that don't may get put out of business. To some it sounds like science fiction but we only need to look at our own history and the things once deemed impossible are now routine.
One such example is the Dick Tracy comics where Dick had a wristwatch with a two way radio. People laughed at Dick Tracy – it was comical - it will never happen. Today, about 40 years later, it is a reality.
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Companies that can automate processes and replace humans with robots will save millions of dollars – no more health insurance, no training just a software update, no sick leave or vacation, no liability insurance, no accounting and payroll, no need for an expensive job search and no more employee lawsuits.
In short, companies that can significantly implement robots will increase earnings and shareholder value. The ones that can do it effectively, ahead of the competition, could also lower prices and effectively squeeze the competition out of business. It should also spawn more M&A activity. This is going to be a major game changer.
So how do we take advantage of this? I would keep my eye open for companies working on robotics and AI. There is one ETF that looks interesting to us because is has such a focus - BOTZ.
We plan to keep an eye on the horizon for credible opportunities. Another company that stands out and has had an incredible run is NVDA which by coincidence is also one of the major holdings in BOTZ.