Mobility is the new normal.
Although sustainable mobile consumption in the future may happen on other devices like wrist watches, smartphones are going to be with us probably till the Martians invade.
Whether in Africa or America, people increasingly want to run their lives on the go, and this is driving an explosive growth of the smartphone, first introduced by Finnish company Nokia (NOK) in 1996.
There are many ways to board this money train.
The most straightforward way is to invest in companies that make the actual handsets - companies like Apple (AAPL), Samsung, Blackberry (BBRY), HTC, Nokia (NOK), etc. However, when it comes to technology investing, i prefer "software" stocks.
If you're also biased towards software, then the smart way to play this trend is to zoom in on companies that make software components for the handset makers. These components typically tackle the three crucial aspects of mobile consumption: Privacy, Security, and Productivity.
Productivity probably determines the buying decisions of most smartphone users. Therefore, in this space you can consider Israeli company LivePerson (LPSN). They make engagements like chat, click-to-call, and email easy on smartphones, so they're big on productivity. So is Nuance Communications (NUAN), the company behind the speech recognition technologies in Apple (SIRI) and Samsung phones. I'm long Nuance.
Productivity and privacy are important but i think the sweet-spot of mobile consumption is security. You may not want to chat with Whatsapp or may feel uncomfortable with mobile banking, but would you want to take a chance with malware squatting on your phone?
That's why I'm also long Chinese firm NQ Mobile Inc. (NQ). NQ is primarily a mobile security firm, but as it turns out, also provides privacy and productivity services in over 100 countries worldwide. This company, which identifies and neutralizes over 75% of all global malware threats before any other company in the world, is adding 400,000 new customers a day. It's currently trading below its 200-day moving average, so this is a good time to long the stock. I expect NQ to ride this wave of exploding mobile consumption high.
This is the first in a series of posts that examine six hot global trends you should invest in now. In the next blog, i examine the hot trend of Aging Population.
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