I grew up as an “IBM” kid. My dad worked as a leading statistician and programmer at one of the main IBM plants in my hometown of Poughkeepsie, New York.
While other kids played with dolls or toy trains, my dad would take me to IBM’s offices and show me all sorts of computer developments.
And later on, my first internship and job were at IBM.
In 1989, IBM made a technological quantum leap that made science fiction a reality…
IBM scientist Don Eigler became the first person to control individual atoms.
Eigler assembled 35 atoms to spell out “I-B-M” in a precise arrangement.
Eigler’s demonstration of the ability to move and configure atoms (Source: IBM)
“We wanted to show we could position atoms in a way that’s very similar to how a child builds with Lego blocks,” he said.
Nanotechnology is the practice of manipulating individual atoms and molecules. But up until Eigler’s successful experiment in 1989, it existed only in theory.
Authors like renowned sci-fi writer Neal Stephenson painted a glorious picture of its applications in his 1995 book, The Diamond Age. He wrote about a world where your every want is possible, from machines that heal our bodies from the inside to buildings made of diamonds.
And now, more than 30 years after Eigler’s accomplishment, we are on the verge of a nanotech revolution.
That’s because we are beginning to see the kind of change some futurists predicted will come from the near-atomic-scale engineering discipline of nanotechnology.
And savvy investors stand on the cusp of huge profit…
Just How Small Is Nano?
Throughout the 20th century, engineers tried to make things smaller. After all, the smaller a piece of hardware, the less time it would take for the electrons to go from one place to another.
And so, for example, we’ve seen the computer go from the size of a room to the size of your back pocket…
As a result, electronics have become lighter, cheaper, and more efficient. So this approach made sense.
But nanotechnology takes the opposite approach. It’s about engineering things from a molecular level. It’s about building things from the bottom up, atom by atom… manipulating matter on the nanoscale.
So how small is nanoscale, exactly?
Let’s break it down…
A centimeter is one-hundredth of a meter… There are 100 centimeters in a meter.
A millimeter is one-thousandth of a meter… There are 1,000 millimeters in a meter.
A nanometer is one-billionth of a meter. There are 1 billion – 1,000,000,000 – nanometers in a meter.
For perspective, one strand of human hair is 50,000 to 100,000 nanometers wide.
So, we’re talking microscopically small.
But this “tiny” technology will have a huge impact…
This Revolutionary Technology Will Change Lives
Nanotech applications have an almost infinite variety of uses in virtually every field.
One of the most promising applications is medicine.
Doctors could send nano machines through your arteries to clear plaque. This could help prevent heart attacks and strokes.
These machines could repair damage within every single cell in a human body. They could even assemble new organs to replace aging ones – with perfect precision.
And they could be used to deliver drugs – chemotherapy, for example – on a targeted basis.
But nanotechnology has applications outside of healthcare, too.
Nanomachines could help solve environmental problems by breaking down pollutants and toxins. They could even reassemble them into useful materials.
And nanotechnology is revolutionizing manufacturing as well.
In 2004, scientists at the University of Manchester isolated a layer of carbon just one atom thick. This is called graphene.
Graphene is the thinnest material known to man. It is six times lighter than steel, but 200 times stronger. Adding a miniscule amount of graphene to concrete can reduce the amount of concrete needed in construction by up to 20%.
And graphene is almost entirely transparent. It absorbs only 2% of light. It can be used as a non-reflective covering for solar cells. This helps solar panels absorb much more energy.
The field of nanotechnology is progressing at breakneck speed. It is being incorporated into areas as diverse as clothing, furniture, paint, and computer processors.
And as I show in the next section, research into nanotech is escalating.
So we can expect to hear a lot more about this fast-moving field in the coming years…
Big Money Is Flooding Into Nanotech
Globally, the nanotech market has taken off in recent years. As you can see from this chart, the overall nanotechnology market has nearly quintupled in value since 2010. In 2021, it was worth $85.4 billion.
And it’s growing rapidly. It could reach $289 billion by 2030, according to market research company Precedence Research. That’s an increase of roughly 240% from 2020.
One of the things that ensures growth in any market is continuous patent development.
Patents are often used by companies to show investors they have the exclusive rights to the product they’re developing. Defending this intellectual property (IP) with a patent is critical in the nascent nanotechnology industry.
The U.S. Patent and Trademark Office (USPTO) is the most popular patent register worldwide. Most companies (U.S.-based and non-U.S.-based) register their patents there.
In 2021, a total of 23,750 nanotechnology-related patents were registered with the USPTO. This has been growing steadily in recent years, as you can see from this next chart…
Most of these were registered by organizations in the U.S., China, South Korea, Japan, and Taiwan.
There is huge interest in nanotechnology from some of the tech industry’s biggest champions.
Leading the way are tech giants IBM, Samsung Electronics, and Intel. Combined, the three tech giants had 1,666 nanotech patents in 2019. This was up from a combined 556 patents between them at the start of the decade.
And the U.S. government is also investing heavily in this sector. In 2021, it spent about $1.7 billion on nanotech research & development (R&D) via its National Nanotechnology Initiative (NNI). And it is poised to spend about $2 billion this year.
In fact, since its inception in 2001, the NNI has invested more than $30 billion in nanotech R&D. It has helped develop nanotech applications in areas as diverse as energy, aerospace, sporting goods, agriculture, vaccine development, and consumer electronics.
Public and private investment will drive this ground-breaking technology in the years to come. The nanotech megatrend will revolutionize multiple industries.
And it will create economic value worth trillions of dollars in the process.
How to Get in On This Revolutionary Trend
The best way to get exposure in your portfolio is to buy shares in nanotech-related companies. Unfortunately, many such companies are small, private, and have little-to-no revenue.
So even if you can find any to invest in, they come with a degree of risk only suitable to those with a taste for the higher-stakes table.
A somewhat less risky way would be to buy shares of ProShares Nanotechnology ETF (TINY).
It’s a straightforward investment you can access in your regular brokerage account. As an exchange-traded fund (ETF), it also carries less company-specific risk than investing in individual companies.
But with just $2.7 million of assets under management, it’s tiny. This means there will be considerably lower trading volume than you might see in other ETFs in your portfolio. And because the ETF is so small, you’ll likely have to stomach some volatility.
If this isn’t your cup of tea, you can consider investing in a company like IBM (IBM). It’s a blue-chip technology company with stable profits.
It has invested significant resources in innovation to position itself as a leader in nanotech.
Happy investing, and I’ll be in touch again soon.
Regards,
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Nomi Prins
Editor, Inside Wall Street with Nomi Prins