Finding the best sectors to invest in for 2020 could mean the difference between triple-digit gains and a completely average return.
Just look at how you could've invested in the top sectors last year: 5G, marijuana, REITs, IPOs, and plenty more soared into the stratosphere in one way or another in 2019.
The semiconductor company Advanced Micro Devices Inc. (NASDAQ: AMD) rocketed 131.7% thanks to the hype surrounding 5G. All the while, IPOs raised more than $50 billion - bad press and all.
But with a lot of uncertainty as we enter 2020 - the election, impeachment trial, trade war, possible recession, and more - we're looking to get back to the "basics" for the next group of "sectors" to invest in.
That's precisely why we turned to Money Morning Chief Investment Strategist Keith Fitz-Gerald for insight.
Keith is always telling his free Total Wealth readers about what he calls the six "Unstoppable Trends" in the market. From the times of ancient China to medieval England, the Renaissance, and now to the modern United States, these Unstoppable Trends have made those with foresight incredibly wealthy.
And Keith says they'll continue to help folks generate wealth throughout the 21st century.
The reason is simple: The Unstoppable Trends are backed by trillions of dollars that Washington cannot derail, the Fed cannot meddle with, and Wall Street cannot hijack.
Keith's Unstoppable Trends include:
- Energy
- Demographics
- Medicine
- War, Terrorism, & Ugliness
- Scarcity/Allocation
- Technology
His Total Wealth readers who followed these trends in 2019 made more than 41% this year alone from one of Keith's favorite companies, Raytheon Co. (NYSE: RTN).
Now, he wants Money Morning readers to take advantage of the opportunities they present for 2020 as well. The six "sectors" we're showing you today are poised to be some of the best sectors to invest in for 2020.
Check them out below...
The Best "Sectors" to Invest in for 2020, No. 6: Energy
This top sector to invest in is one of Keith's "Unstoppable Trends." And it's no surprise why.
The world will always need energy. Even if oil prices never hit $100 a barrel again, the energy industry continues to grow.
Heck, both oil production and demand are accelerating. Between now and 2025, demand for oil is anticipated to spike up by 6.1 million barrels per day (BPD). From now until 2040, it's expected to grow by another 12 million BPD.
These billion-dollar energy companies aren't going anywhere anytime soon.
Savvy investors understand this and can ignore the panic-induced headlines you see in mainstream media.
And even if you're still a skeptic over oil, renewables like hydropower, solar power, wind power, and more are increasing in popularity every year. Plus, big energy firms like NextEra Energy Inc. (NYSE: NEE), which provides electrical power, are pursuing renewable energy - making them ripe with opportunities.
The Best "Sectors" to Invest in for 2020, No. 5: Demographics
Now that 2019 is over, the world is on the verge of hitting a milestone we've never seen before in recorded history. The U.S. Census reports the number of folks above the age of 65 will outnumber children below the age of four this year.
Beyond that, one in five U.S. residents are estimated to be retirement age.
Indeed, other countries like Japan are already looking like what our future holds. The aging population over there has had a massive negative impact on the country. Eventually, this will happen to America as well. We'll see reduced productivity, skyrocketing healthcare costs, and struggling social security programs.
Because of this, medical firms such as Becton Dickinson & Co. (NYSE: BDX) could soar with the potential to contribute to global currency realignment and even breaking major currencies like the yen.
There will certainly be more consequences as a result of the "Demographic Revolution," as well, and Keith will help our readers remain up to date as the trend unfolds in 2020.
The Best "Sectors" to Invest in for 2020, No. 4: Medicine
In the United States alone, we spend over $3.1 trillion in healthcare per year.
If the U.S. healthcare sector were a global economy, it would be the fifth largest in the world.
This is largely thanks to the insane size of American medical bills. If you break your leg, that could mean $33,000 down the drain. If you're bitten by your cat, it's a potential $48,000. Heck, if you require dialysis, that's more than half a million dollars for treatment.
And those are just numbers based on what your insurance doesn't cover.
Beyond that, there are over 6,000 hospitals in the United States. And medications are insanely expensive, with millions of people spending an average of $1,200 per year as well in the U.S.
Heck, the average insurance premium in the United States is $440 per person each month.
This kind of spending is a big reason why Keith still loves Apple Inc. (NASDAQ: AAPL). You see, Apple isn't just making smartphones. Apple is starting to tap right into this lucrative trend with software like Apple Watch's electrocardiogram (ECG) app.
So it's easy to see just how much money the healthcare industry rakes in - and how much opportunity is there for you to profit...
The Best "Sectors" to Invest in for 2020, No. 3: War, Terrorism, & Ugliness
As unfortunate as it is, War, Terrorism, & Ugliness will continue to be a part of our world.
Defense ETFs like the SPDR S&P Aerospace & Defense (NYSEArca: XAR) are up 322% since 2011 for a reason. With decades of tension between the United States, Russia, China, and North Korea - as well as the real threat of terrorism looming above - the world is in a constant state of militarization.
The U.S. alone has a $717 billion budget for defense each year because of this. And it continues to spend, renew government contracts, and gear up to defend against any potential threats.
Whether it's ISIS or increased tensions with Iran, Keith says firms like Leonardo SpA (OTCMKTS: FINMY), Raytheon Co., and Lockheed Martin Corp. (NYSE: LMT) will continue to prosper - making the industry one you want to invest in 2020.
The Best "Sectors" to Invest in for 2020, No. 2: Scarcity/Allocation
According to Keith, Scarcity/Allocation is a trend fueled by the absence of precious commodities and the allocation of general resources. These resources include everything from food and water to raw materials, money, and commodities.
Keith says this trend is also pivotal for 2020 because global resources are now more strained than they have ever been.
For example, the World Bank estimates 24 billion tons of fertile soil are destroyed by land erosion annually. On the same note, 29.6 million acres of fertile land disappear as a result of droughts.
Because of this, Keith says firms like CNH Industrial NV (NYSE: CNHI) that focus on agriculture and modernizing farming methods will see a boost in demand and soar in profitability. Another favorite of his is public utility firm American Water Works Co. Inc. (NYSE: AWK).
Now, we've covered quite a few sectors that could take off in 2020. But our top sector isn't like the other ones. It's a broader industry that isn't necessarily new. But it's one that has been - and always will be - important for the world.
And stocks in this top sector to invest in for 2020 could potentially double your money over the next decade...
The Best "Sectors" to Invest in for 2020, No. 1
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Keith's last "Unstoppable Trend" - and our top sector - is Technology. This might not be a surprising pick, but Keith says many investors, unfortunately, don't know how to play this sector.
Yes, Apple Inc., Amazon.com Inc. (NASDAQ: AMZN), and Microsoft Corp. (NASDAQ: MSFT) are great buys. They may even be the first companies that come to mind when you think of the technology sector.
They are great companies that Keith likes. They have their hands in everything from Big Data to medical technology, mobile devices, the cloud, streaming, the food industry, gaming, and... well... just about everything. But that doesn't mean they're the immediate go-to if you're trying to see big gains in the technology sector.
That's because there is a distinction between the obvious choices and searching for the ones that'll truly experience breakout growth.
Keith says there are tons of companies all over the world, like the cloud computing firm VMware Inc. (NYSE: VMW), with a solid footing in the technology sector that could do just that.
But if you're looking for even greater potential upside, we've got you covered, too. Thanks to the 2012 JOBS Act, you now have the opportunity to invest in firms before they go public, as an angel investor. We're talking about the next potential Amazon, Apple, or Microsoft during their beginning stages.
Here's how...
America's Favorite "Shark" Debuts Summit for Finding Unicorn Startups
Angel investing is taking the world by storm.
Everyday people from coast to coast are now backing little-known startups long before they IPO, and they're exploding in value, becoming worth billions upon billions of dollars.
But when you're in the position to have all of these exciting deals at your fingertips, you need a way to determine which could be winners - and which are nothing more than hype.
As you'll see in this brief video, the Angels & Entrepreneurs Summit is exactly the ticket...
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About the Author
Daniel Smoot is a Baltimore-based editor who helps everyday investors with stock recommendations and analysis. He regularly writes about initial public offerings, technology, and more. He earned a Bachelor's degree from Towson University.