The Influence of Price on Technology Investments for Investors
Technology

Investing in Technology: Navigating High Valuations and Attractive Opportunities

Investing in technology can be costly at the moment, with high valuations for many companies in the sector. As wealth managers and investors look for ways to access opportunities while keeping valuation in mind, they are finding it challenging to make informed decisions. Dan Smith, a senior equity analyst at Canaccord Genuity Wealth Management, acknowledges the challenge of investing in technology with current high valuations. He believes that timing plays a crucial role in determining when to enter or exit the market to maximize returns.

Storm Uru, co-manager of the Liontrust Global Technology fund, emphasizes the significant opportunities available to investors in the technology sector. However, he is cautious about excessive valuations and maintains a target price for the stocks he owns. If a stock exceeds the target price, he would consider selling it. Uru believes that focusing on companies that benefit from artificial intelligence (AI), rather than AI companies themselves, can offer more attractive valuations.

Smith agrees with Uru and prefers to look at companies that facilitate AI (AI companies) rather than AI companies directly. By doing so, he sees more attractive valuations in this area. Similarly, Uru finds companies that benefit from AI an increasingly interesting area for investment as they harness technological advancements while also considering valuation factors.

Overall, investing in technology requires careful consideration of both opportunities and risks. While high valuations may present challenges for some investors, others see it as an opportunity to access exciting new technologies and invest in innovative companies. By focusing on companies that benefit from technological advancements and keeping valuation factors in mind, investors can maximize their returns while also mitigating risk.

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