Assignment 6A – Identifying Opportunities in Economic & Regulatory Trends

Assignment 6A – Identifying Opportunities in Economic & Regulatory Trends

• Economic trend: China’s growth rate and growth in developing markets is sliding

• Source: https://www.weforum.org/agenda/2020/01/global-growth-stabilized-2020/
• I believe there in an opportunity here since China is a large world influencer.   
• I think the prototypical customer are American companies dealing with China in some way, such as manufacturing outsourcing
• I think that it will be moderately easy to exploit this opportunity, the Chinese commodities index fell 26%, so taking advantage of their goods will be easy, as they will remain "soft".
• I saw this opportunity since I like to follow Chinese economic activity.  The devaluing of the Chinese yuan currency in 2015 created a perfect buy in opportunity for me in the stock market.  Knowing their current state of economics sometimes has wide reaching influence in global markets. China is one of the biggest world influencers in that area, and learning its growth is tapering off along with that of developing countries (partially correlated with each other) was an intriguing insight.

• Economic trend: With an increase in technology users in developing countries, matters of cybersecurity and user privacy are growing more important than ever

• Source: https://www.weforum.org/agenda/2020/01/what-are-the-cybersecurity-trends-for-2020/
• I believe there in an opportunity here since technology is so embedded in today’s society, everyone and everything is affected by it.  Now that developing countries are gaining more access to this technology, the ever-changing device landscape could be radically shifted like it has in the past. 
• I think the prototypical customers are technology companies worldwide, increasing customer privacy could be heavily advertised and promoted.  Tech titans such as Apple and Microsoft have often prided themselves as being focused on keeping consumer data private and rarely suffer hacks.  Cybersecurity firms can be faced with new challenges on how to keep data secure.
• This opportunity will likely be easy to exploit since the technology sector has continued to remain in prominence.  If more people are gaining access in untapped markets, there is a larger potential customer base for enhanced privacy products or services. 
• I saw this because I follow technological developments and innovation closely.  The technology sector has a heavy influence on the stock market as a whole, with many mutual funds being invested in tech to some level.  I like to track my investments, and personally have a share of Google and Apple.  New implications about privacy would impact them.

·        Regulatory changes: An opportunity for kids to get increased exposure to and education on STEM (Science, Technology, Engineering, & Math) fields at an early age.

·        Source: https://www.govtrack.us/congress/bills/116/s737/summary

• This opportunity exists since President Trump confirmed on Dec. 24 of 2019 how current NSF STEM grant programs should be more inclusive toward early childhood education and increase female participation in these fields. 
• The prototypical customer are the companies producing introductory STEM toys and products geared toward teaching children about coding and computer science.  There is currently a wave of interest and push toward involvement in STEM, and companies such as Hasbro and Target have started selling toys and products of this type.  Now, demand for these items will likely increase.
• I think this opportunity is relatively easy to exploit because it is a clear need and a social trend, companies are already innovating in the area and creating these new products. 
• I saw this opportunity since I’ve always enjoyed STEM fields and keeping up with new technological developments. Science and math are integral parts of our society, and exposing younger generations to it early will help the technology evolve with its customers. 

·        Regulatory changes: Approval of a US Defense budget for the year of 2020.

·        Source: https://www.govtrack.us/congress/bills/116/s1790/summary

• This opportunity is here since the US is involved in many foreign affairs, and must protect itself and its interests from outside threats, including terrorist organizations and hostile nations. 
• The prototypical customer are those companies that work with the federal government and US Army directly.  Examples would include Lockheed Martin, Boeing, Raytheon, and Northrop Grumman, who are awarded multiple multibillion-dollar government defense contracts each year.
• I think it is relatively easy to exploit because defense spending is currently at a very high level (its highest at $718 billion).  The awarding of new government contracts (of which there will be plenty thanks to the new budget approval) often causes a surge in defense stock prices, a fairly easy occurrence to track and leverage. 
• I saw this opportunity since I am heavily involved with the stock market and track it daily.  US defense spending and military events are key catalysts for stock market change and fluctuation.  Tracking government spending across the board has heavy implications for entire sectors of the stock market and investments as a whole.