The last 18 months have been turbulent for investors. A whole range of factors from the increased participation of retail investors in the market to the Ever Given blocking the Suez Canal have completely changed market conditions.
This has seen the prices of commodities like wood reach record highs and the market capitalisation of some companies defy all logical analyses to reach astronomical levels, often before crashing back down again.
The influence of cryptocurrencies has also played a part, both in the crypto markets and on the stock market as companies like PayPal have announced they’re going to allow their customers to hold the digital currencies on their platforms and businesses like Tesla have been buying tokens for themselves.
Changing trading conditions for many businesses have been favourable to some and detrimental to others, creating winners and losers in the stock market. If you had held shares in these industries over the last 2 years, your portfolio will now likely be looking strong.
Gaming
The gaming industry has been enjoying strong growth since the early 2010s. Since then, developers and publishers have been placing much more focus on creating games that can be played for longer, extending the lifespan of their products, and generating revenue over the long term.
They’ve done this by including microtransactions and often making the game “free to play”, moving away from the traditional business model that saw players pay upfront to get access to a game.
Most of the biggest brands in gaming saw their share prices rise by 50-100% between the end of 2019 and the beginning of 2021, though they’ve remained fairly static for most of this year.
The same is true for online poker, with many of the biggest brands being looked on favourably by investors through 2022 and into this year. The future of the industry looks rosy too, with some studies forecasting it will grow by a CAGR of 12% to reach a value of around $92.8 billion by 2023.
Tech
Big tech companies have enjoyed unprecedented increases in their profits and market capitalisation too. If you look at the graphs that show the trends of stock prices for companies like Microsoft and Amazon over the last few years, the graph ticks upwards at angles of 45 degrees or more.
Between 20th March 2020 and 28th August the same year, Amazon’s share price shot up 50%, it hadn’t been hit much by the general decline in the market prior to this either, so it wasn’t a rebound. This was helped by strong sales figures, increased profitability, and its continued investment into services like satellite internet, If you’d held shares in the company in early 2019, you’d have started 2021 with a holding worth twice as much.
Owners of Alphabet (Google’s parent company) shares would have increased their position by 2.8 times, while Apple shareholders would have seen a four-fold increase in that same time period.
Sustainably-Focused Companies
With more evidence emerging all that the time that the world is in a state of climate emergency, there is a lot of demand for companies that are looking to improve this situation. Investors see the potential to make a lot of money and have driven up the prices of these companies as they’ve piled in.
One of these publicly traded renewable energy stocks is Enphase Energy, a company that saw its value increase more than seven-fold between March 2020 and June 2021, thanks in part to it reporting rapidly growing sales for its solar products.
One of the biggest and best-known companies in the sector is Tesla. This is a company that has been incredibly popular among retail investors, particularly thanks to the fact that Elon Musk has become a cult figure for the community.
Although the electric car manufacturer’s stock price is a little lower than where it started this year, it’s up nearly 1,800% on just a few years ago. The excitement around the company means that anyone who held $100 of Tesla stock at the start of 2019 would now have $1,153.
Final Thoughts
There are other companies and industries that have performed exceptionally well over the last few years, but these companies are the ones that stand out the most. It’s important to note though that past performance is not a guarantee of future success, so you should conduct research and consult the advice of an expert before making any investment decisions.
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