Hello everyone. So this is part two of this presentation on these six investment mega trends that we would see double digit growth in the next 10 20 years and where we can really position our portfolio to to beat the markets. If you have not watched part one, do watch part one.
And in fact, in part one, I would just focus on one mega trend, not even one, half the mega trend where I talked about, you guessed it, uh AI. Uh and I said that we need to focus on both the AI enablers, which are companies that make the AI, both the infrastructure and the software, as well as AI uh adopters, companies that use AI to become more efficient to make better products. And these are the ones that would benefit significantly from this AI revolution.
Now, still on the first mega trend because the first mega trend was on AI and robotics. So, let's now talk about the robotics part of it where now AI becomes physical. People are now integrating or have integrated AI into physical robots.
And if you have watched videos on social media like Instagram, Tik Tok and and YouTube, you have seen all these robots in action and they're becoming very very common. Right now in China, it's very common where they are now using robots in concerts, dancing together with humans. I'm sure you've seen robots uh making popcorn, serving drinks in restaurants and bars, becoming more and more common, especially in China.
In fact, China's ahead of the the US in in in terms of robotics. And of course, robots in factories, nothing new, but now you can see it's way more advanced. If you look at Amazon, they are now in the process of deploying a million robots across their factories.
And of course, robots used in uh deliveries, whether is it drones or robots on wheels making food deliveries and stuff like that. And don't forget when we talk about robots we have to talk about autonomous vehicles basically robo taxis that are now uh in being used in the US certain uh cities like San Francisco certain parts of China and if I'm not wrong yeah I'm not wrong I'm sure of this this year 2026 Singapore is beginning their trial for robo taxis in in certain parts of the island and what else do we have we have got robots in sports uh you know China has got a lot of these robots boxing robots in in marathons and then of course you have got uh robots in the adult industry a lot of high techch AI sex robots coming out and of course this is not yet a reality but I can tell you that in the next 10 years uh it's going to be very common for humanoid robots to be in almost every home middle class home uh doing chores doing dishes helping the children um and It's going to be as common as owning a TV. So all this is happening.
So the next huge trillion dollar market would be the robotics market. Now how big this market is projected to be 25 trillion. This is a robotics revolution.
This is a 250fold market surge from current levels and it's divided into three parts. First would be professional service and service robots. You have got autonomous vehicles and you have got humanoid robots which are general purpose humanoid robots that are projected to emerge as a major new category.
So we already have this very widespread. We have this slowly becoming more widespread and this will be the next leap forward. Now a common question I get asked is Adam which robotics company would you invest in?
The answer is actually none of them. Well let me clarify. I won't invest in any uh company that makes generalized robots.
Specialized robots maybe, but not generalized robots like humanoid robots. Why? Because it's it's going to be so competitive.
There are so many companies making them that it's going to be a bloody rate ocean of competition. And I don't like to invest in companies that have a lot of competitors, right? is going to be so competitive.
It's going to be like a commodity where in the end no one's going to make money and even those that make money are going to make very low profit margins. It's the same reason why I've never invested in the airline industry. Now, think about it.
When did airlines become widespread? Commercial airline flying in the 1920s. And since then, the uh commercial airline market has grown uh year after year after year.
Now, it's over a trillion dollars in in market value for the airline industry. However, at its peak, there were about 2,000 airline companies in the 2000s. Right?
Out of the 2,000 airline companies, 90% have gone bust or have been acquired. 90% have died. Only 10% survive today.
And of the 10% of airlines that survive today, only half of them or 5% actually make money every year. And those that make money, the net profit margin of an airline is about 3%. Even some of the top airlines in the world like Singapore Airlines, their profit margins are only 8%.
So you can see that even though the entire market has grown and everyone flies on planes but collectively if you add up all the profits of all the companies it is negative. I won't be surprised if the same thing happens to again robotics makers in the future because they're just going to be too many of them. But does that mean that we can't make money from the robotics industry?
No, it doesn't mean that. So for example again look at the airline industry. Collectively the airline companies don't make money but who makes money?
Who makes money are the companies that sell them the planes like Boeing and Airbus. So same thing in the robotics industry. So instead of investing in companies that make robots like humanoid robots, I rather invest in companies that sell them the parts necessary to make these robots.
So, whoever makes the robots, whether is it Tesla or Xping or Boston Dynamics, whoever makes the robots, and there are so many of them, they all have to order certain parts from specialized equipment makers or they need specialized software. So, I rather own the companies that make the software, which all the robots have to use, or make the specialized parts where most of the robot makers have to purchase. I think that is where the profit margin lies.
I think that is where the companies with the wider economic modes lie versus the robot makers themselves. Unless the robot makers are very specialized for example surgical robots. Yes.
Then that I would consider investing. Yeah. So again these are a list of all the robotic stocks like I mentioned for the humanoid robot makers.
I'll be weary investing in them individually but again they all need software to run. need a software to train the robot to walk to grasp things and stuff like that. And in terms of robotic software, uh two of the leading companies would be Nvidia and PTC.
So, one of the reasons why I hold Nvidia as a big position and going to hold it for the long run is that Nvidia is not just a semiconductor maker anymore. They make AI factories and they are heavily into robotics software through their Isaac platform, their Isac SIM which creates a simulated virtual world where robots can um can uh be trained in the virtual world and they also have got project Groot which which is which is their specific training software for humanoid robots. And you've also got PTC which is another uh robotics software company.
But between the two of course Nvidia has a much stronger mode and that's the one I own. Uh at the same time you can also look at companies that make specific things that robots need which are sensors and perception uh equipment. For example, you've got mobile eye, you've got and I won't really invest in these stocks individually because uh as individual businesses I wouldn't say they are super high quality.
Now, mobile eye is actually not bad in the sense that they've got a narrow mode and their financials are uh not too bad as well. Well, they are fairly predictable but not that that profitable yet. They've got high growth.
They've got a moderate mode. They've got very strong balance sheet. Um but if you take a look at for example Inovvis, you can see there's no mode and u they rate very lowly on predictability, very lowly on profitability.
So, they're not profitable right now. And same with ouster you can see that they are not profitable as well and they don't have an economic mode. So just because they are in a nice niche nice industry but if the business itself is not consistently profitable they don't have a very strong balance sheet then I would rather not invest in them individually but maybe invest in them within a larger ETF.
Now you can also take a look at specialized robots for example like deep sea robots that go deep down under the sea. You can look at healthcare robots and these are the different companies that specialize in healthcare robots and I would say that out of these the one that I would invest in would be intuitive surgical ticker symbol ISRG because it's a very high quality company very strong economic mode but I've not bought it yet because it's still overvalued. If you take a look for example again going back to stock oracle looking at intuitive surgical you can see wow very high in predictability very profitable growth moderate very strong economic mode strong balance sheet but valuation low because it is overvalued the current intrinsic value is 247 is now selling like 541 so really good company but again it's kind of like priced to perfection there isn't much of margin of safety.
You can see the PE ratio is 75 times earnings. Ford P is still 55 times earnings. Love to buy this but right not at this price.
And uh you've got other specialized robots like uh automation companies, defense robotics, that's a big thing. And I do invest in defense robotics but via another ETF which is the SHLD, the Global X Defense ETF that has done very well. I bought it early in 2025 and it's one of my best performers.
It went up like 75% last year and I'm still invested in it because uh they own a lot of the high techch defense companies uh which includes a lot of these unmanned drones and and and robotics that are used for the military. You've got industrial robotics that are made by these companies like Honeywell. You've got delivery robots uh and of course logistics robots.
Uh some of you will know that Amazon is also one of my core positions because I think out of all the companies especially among the mad caps I think it has the it is the biggest beneficiary of the robotics revolution. Why? Because a big chunk of their business is as you know e-commerce and a big part of their cost historically has been labor cost.
So now they're replacing almost every human being in the factory with robots and that would significantly increase their productivity, their profit margins and their earnings per share. So I expect their earnings to grow significantly in the next few years as they fully deploy uh robots. And some of you would know that Amazon also owns Amazon Robotics where they make not just their own robots for factories but they also sell robots to other logistics companies but they don't make humanoid robots but Amazon does have a stake in agility robotics that makes the digit humanoid robot that works in the Amazon factories.
So when it comes to specific companies within the robotics industry, I would say personally I'm looking at or I'm invested in Nvidia uh in Amazon and definitely would love to take a stake in Intuitive Surgical at the right price. Uh and if I want to get exposure to the other parts of the robotics uh market, then I could look at ETFs. if I find the in individual companies are not high quality enough for me to buy or they they're overvalued or they don't have a strong mode.
So there are many robotics ETFs and I think that two of the highest quality ones through my research would be number one the global X artificial intelligence and technology ETF ticker symbol AIQ uh followed by Eyesshar's future AI and tech ETF ticker symbol ARTY. And then the two robotics ETF would be Robo Aro as well as BOTZ. Now between those four ETFs, you can see that the best performer by quite a margin has been again AIQ and then followed by ARTY, uh, Robo and BZ.
So for example, if you want to invest in AIQ, again, don't just jump in blindly, right? Never just go in all at once. You want to do dollar cost averaging for investing.
buy in stages when the price has retraced uh to a support level. So for example, if you are taking a look at AIQ uh you can put in some of the moving averages um and I you can look at weekly candles if you're more of an investor and you can see historically what happens. You know wave up, wave down touches the red line, wave up, wave down touches the red line.
So in shallow retracements, it finds support at this red line. So you want to at least wait for a time when the price retraces to this red line, which is the 20 EMA on weekly candles. Let it retrace here to add.
Right? So remember wave up, wave down, we buy. Wave up.
We do not want to buy after wave up. We want to wait for the next wave down to add in. But if you happen to have a deeper correction like midterm election year this year, we may have uh bigger corrections along the way.
So I would then want to only add a bigger position only if it reaches the 50 moving average on weekly candles which is which is a stronger support during a bigger draw down. So basically I like to buy in trenches. Another level I could uh look at would be here which is a previous swing low.
So these are three support levels where I would slowly build my position if I wanted to build a position in this ETF. So we have just covered the first investment mega trend. Five more to go.
Am I going to take 10 hours? Don't worry. The rest are pretty fast.
Now the second investment mega trend is actually something that I've already made a video on in more detail recently. So let me just talk about it. The second investment mega trend is the AI energy and infrastructure mega trend.
Remember that to run AI and robotics and autonomous vehicles, you need a tremendous amount of electricity. That's right. So historically electricity consumption has only grown at less than 1% a year.
But because of the consumption needs of AI robotics, the need for electricity, the demand is going to grow double digits in the next few decades. So recently it's been reported by Morgan Stanley that there's a projected 44 gawatt power deficit by 2028 because of number one AI exponential growth needs a tremendous amount of electricity to run AI factories 24/7 or data centers. Second is the electrification of the entire economy electric vehicles robotics and onshoring back to the US manufacturing needs a lot of electricity.
So again, why is this a mega trend? Because as AI adoption accelerates, as all companies use AI or people use AI, AI data centers may drive a 15 to 30% compounded annual growth rate in electricity consumption for AI workloads through 2030. Again, I made a whole video on this about 10 days ago.
So do check out this YouTube video called a new growth sector. Yeah. So I was talking about the utility sector as well as the industrial sector as well.
And again the way to invest in it would be specific um independent power producers that are generating the power for data centers. Independent power producers like constellation energy like Vistra for example. And the next thing is to look at grid infrastructure companies like Ethon Corporation as well as uh nuclear power companies and uranium companies.
And as I mentioned in this video, do watch this video. I say personally I would I would not invest in these individual companies uh because they don't really meet my investment criteria which is really strict. So I would rather invest in ETFs and I've mentioned what are some of the key ETFs within uh this sector in that video.
So check out that video for the second investment mega trend. Third investment bank trend is a big one and I've got quite a number of positions within this mega trend. What is that?
Healthcare and the longevity mega trend. What are drivers of this mega trend? It's the silver tsunami.
By 2050, the number of people aged 65 and older is projected to double to 1. 6 billion in the world. And as a result, you're going to see rising chronic disease like diabetes in the world.
Number two driver, massive cultural and economic shifts towards healthy longevity. So as you notice people around you are getting more and more health conscious. The third would be the adoption of AI in drug discovery and precision medicine.
Medicine that's tailored uh for your specific DNA. That's another very very big industry. Now why is this a long-term secular mega trend?
Because people age 65 and over, I'm soon going to be in that cohort unfortunately are the fastest growing demographic in the world now. And as people age, what happens? They increase their health care consumption.
And the other good thing about this sector which is healthcare and longevity is that it is recession proof. In the worst recession, you still need to go to hospitals, you still need medication. It's recession proof with a very strong uh trend.
So within the health care uh sector, if you will, there are a few high growth subsegments within this sector. The first would be metabolic health which would be drugs to combat obesity, diabetes and cardiovascular risk. Among these the biggest market is obesity.
The two leading companies Novon Nordis and Eli Liy. Now Novo Nordis used to have a 80% 90% market share in the obesity market but because their management really screwed up their supply chain management. they didn't have enough supply to meet the demand and then we had alternative generic competition catching up.
We have got Eli Lilly catching up and as a result their market share from 90% has now dropped below 50%. And Eli Liy actually increased their market share to now above 50%. So right now Eli Lee is the leader in uh the obesity market because again Novi screwed up but they fight their management they got a new management in and right now they are the first to introduce the oral uh pill for weight loss and Eli Liy is going to launch it very soon but I think it's delayed to to quarter two.
So it's a fight between the two. Now between these two companies, Eli Lily is so-called now the leader and Nova Nautis is like the underdog that's now trying to catch up. I bought Nova Nautis some time ago.
Uh and the reason I didn't buy Eli Lily at the time is because Eli was way overvalued. But now that Eli has actually generated huge profits, their new intrinsic value now puts them at no longer being overvalued. So now Eli Liy is also undervalued but not as much as Novo Nord is.
And if you ask me between the two, yeah, Eli is the much stronger company. Um, not just because they've got a higher market share than Novo Nord is, but also because they don't just lead in obesity, but they have leadership in other areas like oncology, which is cancer, and Alzheimer's research. All right.
Um, so frankly speaking, if I didn't own either company, I'll probably buy Eli Liy first. But again, the reason I bought Novo at the time was because Eli was too expensive. I bought Novo because it was cheap.
And now it's still very cheap. But now it looks like it's beginning to rebound as they are uh as they have as a new management has taken over and now they're beginning to so-called slowly win back their market share. In the near future, I'll probably take a stake in Eli as well so that I'm exposed to to both of them.
But I want to be careful to not overexpose to drug companies because drug companies in general in the long run are one of the more unpredictable in terms of healthcare companies. I prefer bigger stakes in hospitals for example which I do have a big stake in HCA healthcare which is the biggest private hospital chain in the US as well as bigger stakes in medical devices companies right so for example if you look at moves you can see currently it's at $57 it is about roughly about 35 36% undervalued uh it remains fundamentals remain very very strong you can see price is down a lot right now is slowly beginning to reverse and I think more or less it has made its bottom. The way Novo is priced right now, it is priced in a way that is only projected to grow at 4% in the long run, which I think the market is being overly pessimistic.
Analysts are over pessimistic. I think that if they can show that they can grow again back to double digits, then I think the share price could easily double from here. All right.
On the other hand, Eli is analysts are already projecting a 30% growth in the next 5 years and a 18% growth in the long run. And based on that projection, they are worth 1,3 and at today's share price, they are slightly undervalued. Other growth segments number two, robotics and precision surgery, which I already talked about in the earlier part of this video, and the leader in that area is Intuitive Surgical, ticker symbol ISRG.
Great company. I love to own it. Right now, still too expensive.
Waiting for it to get cheap. Let's see when that happens. Next would be medical devices and diagnostic companies.
Companies like thermopisher, Idex laboratories and adward life sciences. All three are great companies of which I own two of them. And next will be healthcare and IT platforms.
These are basically software that runs the healthcare industry like Viva Systems and IQVIA. And you've got scale managed health care services or basically health insurance and managed care services like United Health and HCA Healthcare. Both are fundamentally great companies.
Of course, United Health because of short-term problems and negative market sentiment, it is still currently very undervalued. And of course, we know that Buffett recently took a big stake in United Health and just in fact bought more in the last quarter as well. But now he's retired right now.
How about biotech? Because we know that biotech can be a very high growth industry. And biotech, if they come up with a breakthrough drug, you can have the share price go up 10, 50, 100fold, right?
But bear in mind that while biotech names can deliver huge upside, their economic mode is less durable and the outcomes are more binary. So in other words, very high risk, very speculative. So biotech companies either make it very big or they die.
>> [laughter] >> Okay. So, personally for me, I won't invest in an individual biotech company unless it's like a short-term trade uh or unless I buy within an ETF. But to do a long-term investment in biotech, it's it's very very risky and uh beyond my risk appetite.
Yeah. So again as usual as an investor you can look at individual leaders in these different segments or simply invest and write the mega trend through an ETF and there are many healthcare ETFs. So for example, you've got the healthcare uh sector ETF ticker symbol XLV which basically invests in all the segments whether is it drugs, manage healthcare, biotech and and and medical devices all roll into one.
If you want to invest in specific subsegments like medical devices then you can look at ETFs like IHI which is the Eyesshares US medical devices ETF. All right, so we covered the first three mega trends and I'll do the next three in part three of this video series. I'll see you guys in the next video.
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