The Hidden, Yet Surprisingly Obvious Investing Secret of the Top 1 Percent

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It's rare when an investing secret becomes so obvious that it looks us in the eye…

And nearly all Americans completely miss it.

But one such secret has been so greatly underestimated that Nobel Prize-winning economists, investing legends and those considered to be the "best" minds in finance are now finally waking up to its possibilities–and its astonishing track record.

In fact, this secret has been one of the key drivers in the growing wealth divide between the top 1 percent and the average American worker.

It has grown more pronounced in the past three decades: the rich have gotten richer, the poor have gotten poorer, and the middle class has been increasingly marginalized.

Many believe that the ultra-wealthy have achieved their status by either being born into money or by becoming a C-level executive for a publicly traded company. But as Stanford University professor Joshua Rauh explains in a recent study, both of these assumptions are wrong.

The biggest and obvious secret to new-found, extreme wealth?

Investing in technological innovation and the expanding global scale and branding of must-have products and services.

And once you learn how to harness this trend, you'll know how to invest like the top 1 percent and can begin your path to accumulating extreme financial wealth.

The Rise of the 1 Percent

The expansion of wealth for the richest of the top 1 percent has come from their ability to invest in disruptive technologies that globally expand their scale.

As Rauh and University of Chicago Booth Professor Steven Kaplan explain, this is a relatively new phenomenon.

In 1982 the Forbes 400 list of the wealthiest on earth was dominated by "Old Money," which consisted of family names transcending generations of wealth from Old Europe and the Robber Barons or emerging America. The Vanderbilts, the Rothschilds, the DuPonts et al.

But within just 30 years, the top 1 percent of the 1 percent have risen from an unmatched capability to introduce radical technological innovation into global markets, or to expand businesses to the four corners of the earth through best-in-class distribution of high-quality and often commoditized products.

Rauh and Kaplan explain that on a weighted basis nearly 25 percent of companies owned by the wealthiest 1 percent have a sizable technology component enabling them to reach global consumers on an unmatched scale.

Retail companies with strong technology components and expanded scale have made billions for entrepreneurs like Jeffrey Bezos of Amazon and the heirs of Sam Walton of Wal-Mart. In addition, tech companies like Microsoft, Apple, and Cisco have generated billions of dollars for their investors.

They have also drastically increased the standard of living for billions of people around the globe. And that has created an interesting challenge for the left-of-center who are interested in redistributing wealth.

As innovation and scale have led to extreme wealth for the richest, their entrepreneurial efforts required economic incentives that ultimately lead to stronger telecom infrastructures, increased worker productivity, and a better standard of living for everyone.

Tearing down innovation to level wealth would prevent the world from benefiting from these dramatic achievements. This is such an obvious story that even Paul Krugman, upon reviewing this trend in December, noted that ownership of technology is a far greater driver of economic inequality than thought, but conceded that attempting to reduce it would alter society for the worse.

Krugman stated: "If this is the wave of the future, it makes nonsense of just about all the conventional wisdom on reducing inequality."

How to Invest Like the Richest of the Rich

Identifying the best ways to invest in these scalable companies is easier than ever thanks to Money Morning Chief Investment Strategist Keith Fitzgerald.

Technological innovation and scale are the keys to the Money Map Method, a strategic allocation model created by Keith. He advocates that 40 percent of your portfolio should be invested in companies known as "glocals": Global companies that reach into localities worldwide.

Keith says that glocals are actually the most innovative and powerful companies in what they do. They have the ability to reach international markets on a level of scale that is unmatched. In addition, they have developed design, manufacturing and distribution systems that are the most innovative and lean around, making it very difficult for new competition to emerge and displace their innovation and global reach.

However, technological advancements and innovations are constantly emerging that will displace today's innovations over time. So if you missed the current innovation train, there will be new ones that can make investors a lot of money if they know how and where to look.

Starting next week we will reveal to you the Six Questions that can Make You Rich. It's a simple, but valuable outline that you can follow to understand which technology, telecom, retail and other game changing industry stocks will break out over the next decade.

It's so easy that all someone needs to do is answer "Yes" to all six questions as they learn how to evaluate radical innovations.

By answering "Yes" you will quickly identify which investments are life-changing innovations or just simply cultural fads that will fall by the wayside in only a few months.

Be sure to check next week to discover the first question in our series. The answer will help you identify five or six emerging sectors that are poised to make the new crop of 1 percenters even richer.

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