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Best Investments 2014: Turn Our Greatest Threat Into Your Biggest Profit

[Editor's Note: One of 2014's best investments is a $60 billion industry that could grow 10-fold in 10 years. No wonder this industry's stocks have surged 25%, 30%, even 100% this year.]

For most of 2013, we've warned about China's ongoing hack attacks on American companies and government agencies. The assaults highlighted the fragility of our current infrastructure networks.

In March, the National Intelligence Estimate (NIE) announced that the U.S. "is the target of a massive, sustained cyber-espionage campaign that is threatening the country's economic competitiveness."

But a recent announcement about cybercrime signals a major change to this threat's evolution…

According to statements last month by Federal Bureau of Investigations (FBI) Director James Comey, cyber-attacks have replaced domestic terrorism as the top threat to the U.S. homeland. A major cyber event has the potential to cause widespread problems for an economy that relies so heavily on technology, distribution, and lean processes.

That means two things…

First, there's an immediate need for more cybersecurity investment, which will increase over the next few decades.

Second, the companies in this online defense space will become necessary to U.S. business and national safety – making them among the best investments in 2014.

Investors can reap big profits from companies protecting the backbone of the 21st century economy.

Cybercrime: "All of Us are Neighbors"

Crime is going digital because the money and the victims are there and more vulnerable than ever.

But unlike real-world crime, where some people can afford protection like living in more secure buildings and gated communities, the online world leaves everyone susceptible.

"That's where the bad guys will go," Comey told Congress. "There are no safe neighborhoods. All of us are neighbors [online]."

And the importance of keeping our "neighborhood" safe grows each year…

The virtual world is displacing the brick-and-mortar economy of the 1980s. As a result, we've seen remarkable growth and increases in living standards, as trade and communication are more instant than ever.

But with that growth, built on the backbone of technological infrastructure and connected devices, the threats to economic growth built on speed, screens, and scale are grander than ever.

McKinsey Global Institute forecast that the "Internet of Things" – the ability for people, objects, and animals to automatically transfer data over a network with the use of portable devices – is so big and growing so quickly it will add hundreds of billions of dollars a year in new gross domestic product (GDP) growth by 2020.

While technology has fueled a boom in global trade and commerce, it brings risks with it. We'll need more protection. The cost of "getting it wrong" will only get worse.

The Center for Strategic and International Studies this year reported that cybercrime losses result in $500 billion globally, per year. As attacks grow more pronounced, corporate IT security budgets will rocket from $65 billion in 2013 to $93 billion in 2017.

So where should you put your money?

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