Investing in the Internet of Things (IoT)

A recent Business Insider article discussed the top Internet of Things (IoT) companies to watch and stocks to invest in. But before we get into the specifics, let’s first go over what IoT means. Broadly speaking, IoT is a general trend towards everyday objects and appliances being connected to the Internet. This allows for these devices to send and receive data, spawning so-called “smart” technology. Picture a futuristic world where your refrigerator can keep track of what groceries you need and can automatically order them from Amazon. IoT became increasingly discussed starting in 2014 and is now considered to be one of the most important technology sectors. With such wide-spread applications, IoT provides a defined theme for investing in new technologies and the companies involved. In other words, if we believe that IoT as a whole will one day be an integral part of life, but don’t yet know in what specific manners it will be most important, then we can invest in IoT by spreading our risk across a variety of participating companies.

According to Business Insider, IoT is expected to be worth trillions of dollars by 2020. Investors can take advantage of that growth by investing in related stocks. Each of the companies listed below is doing something innovative and important in the IoT space. Some are smaller companies with huge upside potential, while others are established technology companies that are either developing hardware, software, frameworks, or integrations into existing products. All are publicly tradable.

  • Honeywell (HON)
  • Comcast (CMCSA)
  • T-Mobile (TMUS)
  • GE (GE)
  • AT&T (T)
  • Cisco (CSCO)
  • IBM (IBM)
  • Amazon (AMZN)
  • Skyworks (SWKS)
  • Apple (AAPL)
  • Sierra Wireless (SWIR)
  • Google (GOOGL)
  • Iridium Communications (IRDM)
  • Ambarella (AMBA)
  • ARM Holdings (ARMH)
  • Texas Instruments (TXN)
  • PTC (PTC)
  • Fitbit (FIT)
  • ORBCOMM (ORBC)
  • Garmin (GRMN)
  • Blackrock (BLK)
  • InvenSense (INVN)
  • Microsoft (MSFT)
  • Control4 (CTRL)
  • Silicon Laboratories (SLAB)
  • CalAmp (CAMP)
  • LogMe In (LOGM)
  • InterDigital (IDCC)
  • Ruckus Wireless (RKUS)
  • Linear Technology (LLTC)
  • Red Hat (RHT)
  • Nimble Storage (NMBL)
  • Silver Spring Networks (SSNI)
  • Zebra Technologies (ZBRA)
  • Arrow Electronics (ARW)
  • Broadcom Limited (AVGO)
  • Microchip Technology Incorporated (MCHP)
  • Facebook (FB)
  • Intel Corporation (INTC)
  • NXP Semiconductors N.V. (NXPI)
  • Oracle Corporation (ORCL)
  • Splunk Inc. (SPLK)
  • Qualcomm Inc. (QCOM)
  • Motorola Solutions Inc. (MSI)
  • eBay Inc. (EBAY)

Each of these companies is expected to be a player of some sort in the IoT space, but how can we actually invest in them? If you have the funds, you could set up an account with Robinhood and invest in each one of the stocks individually with zero trading fees. Feel free to use my referral link if this is your method of choice (http://share.robinhood.com/johnr347). It’s certainly the most cost efficient way to invest.

On the other hand, if you don’t have six figures sitting around to play with, you could try setting up an account with Motif. Motif allows you to build investment packages centered around a single theme of your choice, IoT companies for example, but including up to 30 different stocks, with each stock given a weighted portion of the total group. Once your “motif” is built, you can buy/sell it as much as you want. There are minimum buy requirements and each buy/sell/rebalance of a “motif” has a fee of $9.95, but it means you can purchase fractions of shares of stocks, rather than being required to purchase whole shares of stocks. It also means you can spread your risk across a wide variety of companies rather than putting all your hopes in only a few plays. Feel free to use my referral link if Motif sounds interesting to you (https://www.motifinvesting.com/offers/raf-friend?utm_source=raf&utm_medium=viral&utm_campaign=link_share&raf=7TjXCPi01lkK9M9QpjNM86hzd9ZyIPvqmdx893BYOK-~KZn-g9qQ97p2wTu8hiO0MaPevHGREvM.).

The trading fees in Motif do mean that if you’re working with a low balance, then you have to you perform exceptionally well to make a significant return, and certainly the goal is to always at least beat the market. Lucky for you, I’ve already set up a motif for investing in IoT companies:

Internet of Things (IoT)

I created the IoT motif on 01/15/2016, and to date it has 19.4% return, beating the market by 4% during that time period.
I cannot guarantee that my IoT motif will continue to perform this well, and I am certainly not an expert investment advisor, but if you want to make a long-term bet on IoT companies, then buying my IoT motif is one way you could do so. I plan on holding my positions for years. Or, you could always create your own motifs.

Thank you for taking the time to read my post and stay tuned for more investing ramblings to come. Also, please take a moment to check out my other motif packages:

Virtual Reality

Online Streaming

– JPR

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