In today’s Money Morning…three massive industries ripe for disruption…real disruption is about accessible information…seven disruptive small-caps with near limitless potential…and more…
Here’s a bit of a brainteaser for you.
What do hydrogen splitting, computer memory, and automated logistics have in common?
Well, I’ll admit this was a bit of a trick question.
But there are a few very broad and general answers that you may have guessed…
For starters, all three are massive, trillion-dollar-plus industries. Each of which is still growing exponentially larger, making them an investment megatrend in their own right. And you could even argue each of these sectors is becoming far more prominent in our post-COVID society.
After all, demand for green energy, ever-increasing computational power, and smarter delivery systems have all featured heavily in the past 18 months or so. Developments that would go a long way to solve many of the pain points brought about by COVID and the subsequent lockdowns.
None of these are the answer I am alluding to, however.
No, the real answer to my teaser is that these are three massive industries ripe for disruption from three tiny Aussie stocks. A collection of small-caps that are each developing a solution that could deliver a paradigm shift for these trillion-dollar sectors…
Real disruption is about accessible innovation
Now, I know the term ‘disruption’ gets thrown around a lot in investing circles.
Wall Street has basically bastardised the word to all hell, using it to describe any kind of improvement in almost any kind of market.
But that is not what the true definition of disruption is all about.
The man who coined the term ‘disruptive innovation’ — Harvard professor Clayton Christensen — has been crystal clear on this matter. Noting that disruption isn’t simply about making a ‘better’ product or service, it is about accessibility and affordability.
And, more importantly, it often comes from the least likely of places…
‘The theory [disruptive innovation] explains the phenomenon by which an innovation transforms an existing market or sector by introducing simplicity, convenience, accessibility, and affordability where complication and high cost are the status quo.
‘Initially, a disruptive innovation is formed in a niche market that may appear unattractive or inconsequential to industry incumbents, but eventually the new product or idea completely redefines the industry.’
This is what I mean when I tell you there are three primed small-caps on the ASX right now, ready to disrupt the three huge industries I mentioned. Stocks that, to the average person, almost certainly seem ‘unattractive’ or ‘inconsequential’ right now.
After all, that is precisely why small-caps are small. Because the companies have yet to prove themselves. The kind of stocks that most investors don’t even know about, let alone show any interest in.
But, if or when they do succeed, it becomes impossible to ignore them.
Often delivering the kind of disruption that Christensen is talking about.
Sometimes even to the point of changing an industry or market forever.
And these kinds of opportunities are where the biggest gains can be made…
PS: We reveal four little-known small-cap stocks that cannot be ignored…Download your free report now.
Seven disruptive small-caps with near limitless potential
Today I’ve outlined just three potential industries set for the disruptive treatment by three respective small-caps. The names of which I’m keeping under wraps because they are a part of a brand-new report by fellow Money Morning editor Murray Dawes and myself.
Just three examples from a seven-stock list that each have the potential to deliver unparalleled disruption.
Which, for investors, means the possibility to also deliver eye-popping returns.
So if you want to learn more, then I suggest you check out our comprehensive report.
Because as Murray and I have been trying to clue you in on over the past few days, Aussie small-caps have a lot to offer right now. An investment avenue that is less about day-to-day macroeconomic gibberish and more about long-term potential.
And in our current social climate, the desire and need for this sort of long-term innovation is immense. With all manner of trends and narratives driving a market frenzy.
The hard part is simply knowing how to pick the genuine innovators over the duds. It’s no doubt a speculative activity, and you need to be comfortable losing whatever capital you put into small-caps. But when you find the right one at the right time, the upside can be well worth it.
That is precisely what Murray and I have strived to do in this report. Scouring the market for the best and most-promising companies to be found right now. Regardless of industry, outlook, or current performance.
The only commonality between them all is their tiny market caps and disruptive potential.
So again, if you’re looking for some of the most-promising long-term investment opportunities right now, you won’t want to miss this report.
Read it for yourself and you’ll see that we’re talking about true disruptive innovation.
Editor, Money Morning
PS: Ryan is also the Editor of Australian Small-Cap Investigator, a stock tipping newsletter that hunts down promising small-cap stocks. For information on how to subscribe and see what Ryan’s telling subscribers right now, click here.