The sixth installment of the Fisher Investments On series is a comprehensive guide to understanding and analyzing investment opportunities within the Technology sector. Fisher Investments on Technology can help you quickly become familiar with this highly diversified sector, how the sector is segmented by industries, their respective macroeconomic drivers, and the challenges facing Technology firms.
This reliable guide skillfully addresses how to determine optimal times to invest in Technology stocks, and which industries and sub-industries have the potential to perform well in various environments. The global Technology sector is complex, including a variety of sub-industries and countries—each with their own unique characteristics. Using the framework found here, you'll discover how to identify these differences, spot opportunities, and avoid major pitfalls.
Fisher Investments on Technology:
- Discusses industry fundamentals, drivers, attributes, and potential challenges
- Addresses the challenges unique to Technology and some common pitfalls to avoid.
- Delves into top-down investment methodology as well as individual security analysis.
- Outlines a five-step process to help differentiate Technology firms—designed to help you identify ones that may have greatest probability of outperforming
- Provides investment strategies for a variety of market environments
Filled with in-depth insights and expert advice, Fisher Investments on Technology provides a framework for understanding this sector and its industries to help you make better investment decisions—now and in the future. With this book as your guide, you can gain a global perspective of the Technology sector and discover strategies to help achieve your investing goals.
About the Author
About Fisher Investments Press
Fisher Investments Press brings the research, analysis, and market intelligence of Fisher Investments' research team, headed by CEO and New York Times bestselling author Ken Fisher, to all investors. The Press covers a range of investing and market-related topics for a wide audiencefrom novices to enthusiasts to professionals.
BRENDAN ERNE is an equity research analyst at Fisher Investments, focusing on the Global Technology sector. He is also a contributing columnist for MarketMinder.com. Erne received a BA in finance from Washington State University. Prior to joining Fisher Investments, he worked as a financial advisor for Ameriprise Financial in Bellevue, Washington. Originally from Redmond, Washington, Erne currently resides in San Francisco.
ANDREW S. TEUFEL has been with Fisher Investments since 1995, where he currently serves as a Co-President and the Director of Research. Prior to joining Fisher Investments, he worked at Bear Stearns as a corporate finance analyst in its Global Technology Group. Teufel also instructs at many seminars and educational workshops throughout the United States and United Kingdom, and has lectured at the Haas School of Business at UC Berkeley. He is also the Editor in Chief of MarketMinder.com. Teufel is a graduate of UC Berkeley.
Table of Contents
Part I Getting Started in Technology 1
Chapter 1 Technology Basics 3
More Than Gadgets ... A Means 4
Technology 101 7
Starting Small: Semiconductors 7
Getting Larger: Products and Components 12
Making It All Work: Software and Services 20
Chapter 2 A Brief History of Modern Technology 25
The Snowball Event: History of Semiconductors 26
History of Computers 31
History of Communications 35
History of the internet 37
Chapter 3 Technology Sector Drivers 43
Economic Drivers 43
Political Drivers 57
Sentiment Drivers 61
Part II Next Steps: Technology Details 67
Chapter 4 Technology Sector Breakdown 69
Global Industry Classification Standard (GICS) 69
Global Technology Benchmarks 71
Technology Industry Breakdown 75
Chapter 5 Challenges in the Information Technology Sector 99
Product Maturity and Obsolescence 99
Fighting Maturity and Obsolescence 101
Extreme Fluctuations in Supply and Demand 110
Intellectual Property Threats 113
Chapter 6 A Deeper Look at Current and Emerging Technologies 117
Semiconductor Production Process 118
Emerging Manufacturing Technologies 122
Computer Technology 124
Part III Thinking Like a Portfolio Manager 131
Chapter 7 The Top-Down Method 133
Investing Is a Science 133
Einstein's Brain and the Stock Market 134
The Top-Down Method 136
Top-Down Deconstructed 141
Managing Against a Technology Benchmark 149
Chapter 8 Security Analysis 155
Make Your Selection 156
A Five-Step Process 157
Important Questions to Ask 165
Chapter 9 Upgrading Your Portfolio-Investing Strategies 175
Strategy 1 Adding Value at the Sector Level 176
Strategy 2 Adding Value at the Industry Level 178
Strategy 3 Adding Value at the Security Level 183
Strategy 4 Adding Value in a Technology Sector Downturn 184
Strategy 5 Venture Capital 185
Good Luck! 186
About the Authors 201