Nextury Technology Fund is recording nearly 40% return to investors for the second year in a row
While 2020 was quite a challenging year for many businesses, the global pandemic brought extremely high returns for investors in technology sector. Investors are also willing to continue taking risks during the second wave of the virus and believe that technological progress will not burst even after vaccination has started around the world. How has COVID affected the investment culture and what can be expected this year?
Businesses and investors are advised to prepare for long-term change
The global pandemic continues to bring particularly high returns in the technology sector. Nextury Technology Fund, which invests in global high technologies, reported 38.4% return to investors in 2020. "During the first wave of the pandemic, we recorded a big leap in digitalisation, which was affected by the rapid growth of the technology sector. Increased investor attention to companies in this sector is also being observed during the second wave of the pandemic. It is currently one of the few highly attractive investment segments. In 2021, even with the advent of vaccines against the virus that has taken over the world, the same rapid growth is expected, ” commented Ilya Laurs, Chairman of the Board of the Fund.
According to I. Laurs, investors are worried about how inflation will affect us, what impact it will have on the economy, and the opinion of market leaders is also important here. Can the investment climate be expected to change this year?
"My opinion coincides with the mood of the world industry, which, by the way, is positive. Assessing the returns brought during the first wave of the pandemic, investors are determined to increase risk. For what reasons? I will draw attention to one of the most important aspects - already after the beginning of the pandemic, the society had to mobilize, adapt to the changed situation as flexibly as possible. Technology has played and continues to play a key role here. We have adapted and are increasingly improving our skills in the field of technology every day, and more processes are being digitized: at work, at school, in business. Some people will not return to the previous physical world even after the end of the pandemic, as the years of forced digitization have taught consumers to behave differently. New habits, mentality, ability to work with technological instruments will be long-term, ” I. Laurs is convinced.
Investors are turning their attention to China’s technology giants
Which markets will be most relevant for investors in 2021? Asia, especially China, stands out in the world in terms of both growth and monetary policy. GDP is projected to grow by 8% in China this year. Compared to Europe, it is the only country that has already recovered from the first wave of the pandemic, so there are plans to focus more on investment in the region. China is one of the most promising but unjustifiably disadvantaged countries in terms of investment. Mr. Laurs emphasized that one of the key strategies of Donald Trump's term was a conscious message to the Chinese technology sector about the global geopolitical competitive advantage of technology. Many famous and large companies have been destroyed. The last victim of this plan was the DJI drone.
The accelerating vaccination process, according to I. Laurss, should not stop, but strengthen the growth of the technological economy. In addition, incentives and interest rates will remain low, so it can be assumed that this will encourage positive people's attitudes. A new economic cycle is beginning, so investors are already advised to prepare and plan the investment process.