Here are three I think could make committed ‘buy and hold’ investors a lot of money over the next decade.

The robots are coming

If you believe the tabloids, many of us face near-certain redundancy as machines take over the world. Sensationalist headlines aside, it does feel like the trend towards automation is only going to get stronger as the years pass. Using robots for repetitive, mundane tasks does, after all, free up more time for humans to focus on more important work. 

One way of getting exposure is through the L&G Global Robotics and Automation ETF. This invests in a basket of 90 companies, all of whom generate a “material proportion of their revenues” from the industry. Fees are high, relative to your average FTSE 100 tracker, but this has been more than compensated for by the growth seen to date (+62.6% over the five years to December 31, 2019).

An alternative would be the iShares Robotics and Automation UCITS ETF which has a lower ongoing charge and slightly less concentrated portfolio. 

Going electric

The fact US manufacturer Tesla eclipsed £100bn in value last week should give some indication of just how excited investors are over the electric car revolution. 

This enthusiasm makes sense. Assuming the consensus forecast is right, there’ll be approximately 30m such vehicles on the roads in 2030. Right now, there are only 3m. 

You could, of course, just invest in Tesla (although be prepared for a bumpy ride). An alternative would be to buy into companies providing services to the global automotive industry, such as UK-listed AB Dynamics. 

For those with strong stomachs, there’s also the option to invest in businesses that specialise in mining for metals that will be essential to this market. Electric cars will, for example, require roughly three times the amount of copper needed in conventional vehicles. Nickel is likely to be a central component of the batteries that power them. 

While there are few funds currently dedicated to tracking this trend, iShares does offer a way in through its Electric Vehicles and Driver Technology UCITS ETF. With 95 holdings, the fund is sufficiently diversified and has a reasonable ongoing charge of 0.4%. 

Climate crisis

From the push for retailers to use less plastic, to the growing popularity of veganism, to using more environmentally-friendly ways of generating power, tackling climate change has become a priority.

Looked at purely from an investment perspective, this is potentially great news for a number of UK-listed firms. FTSE 100 member and corrugated packaging specialist DS Smith could be a big beneficiary, particularly as more and more of us are choosing to shop online. With its growing vegan range, high street baker Greggs could also be a tasty long-term hold. 

When it comes to renewable sources of energy, a relatively cheap exchange-traded fund might be best option, particularly as identifying the long-term winners in this space arguably requires more specialist knowledge.

Blackrock’s again offers such an option with its iShares Global Clean Energy UCITS ETF. The fund rose a little under 44% in 2019 alone, highlighting just how lucrative going green is becoming.

The post 3 megatrends for the next decade (and how to invest in them) appeared first on The Twelfth Magpie.

More reading

• With a yield of 6.8% and a P/E ratio of 12.1, is this a dirt cheap FTSE 250 stock to consider?
• Will SpaceX, Nvidia, or Alphabet be the first $10trn stock?
• Up 95%! This FTSE 100 stock’s outperformed Nvidia over the past year
• With a 9.3% yield, is this an amazing opportunity to consider buying dirt-cheap Taylor Wimpey shares?
• How much do you need in a Stocks and Shares ISA to aim for £375 a week in retirement?

Paul Summers owns shares of AB Dynamics, Greggs, and LEGAL & GENERAL UCITS ETF PUBLIC LIMITED COMPANY ROBO GLOBAL ROB&AUTO GO UCITS ETF (GBP). The Motley Fool UK owns shares of and has recommended Tesla. The Motley Fool UK has recommended AB Dynamics and DS Smith. Views expressed on the companies mentioned in this article are those of the writer and therefore may differ from the official recommendations we make in our subscription services such as Share Advisor, Hidden Winners and Pro. Here at The Motley Fool we believe that considering a diverse range of insights makes us better investors.

With that in mind, here’s a look at one Brexit-proof FTSE 100 dividend stock I’m interested in buying for my ISA this year and watching closely right now.

Global healthcare

Smith & Nephew (LSE: SN) is a leading healthcare company that specialises in joint replacement systems for knees, hips, and shoulders. It operates in 100 countries and generates a large proportion of its revenues from the US and emerging markets, meaning that it should be well insulated from any Brexit-related economic downturn.

There are a number of reasons I like the look of Smith & Nephew and I am keen to add it to my portfolio. For starters, the stock looks set to benefit from an extremely powerful trend – the world’s ageing population. According to data from United Nations, the number of people aged 60 or over across the world is set to double by 2050. This should provide significant tailwinds for the group in the years ahead as demand for joint replacements rises.

The group’s emerging markets exposure (17% of revenue) is another plus. When a country experiences a rise in wealth, one of the first things you often see is a corresponding rise in demand for healthcare. With wealth set to rise significantly in countries such as China and India over the coming decades, Smith & Nephew should benefit.

Technological advances

The FTSE 100 stock also looks quite exciting from a technological perspective, in my opinion. Just a few weeks ago, the group announced that it was “making a long-term commitment to bring together advanced technologies in robotics, digital surgery, and machine learning as well as augmented reality to empower surgeons and improve clinical outcomes.”

As I mentioned recently, robotics has come a long way in recent years and what robots can do these days is quite amazing. The fact that Smith and Nephew is currently working on a handheld robotic surgical system that is designed to “improve the surgeon experience” is certainly a positive development.

Dividend legend

Finally, Smith & Nephew is a legendary dividend stock, as the group has paid a dividend every year since 1937. Dividend coverage is high too, meaning the chances of a cut in the near term are low. Currently, the yield is around 2%.

The shares have had a good run over the last year and currently trade on a forward-looking P/E of 19.7. While I don’t think that’s outrageously expensive for a high-quality dividend stock with a lot of potential, I would prefer to pay a slightly lower price. So for now, patience is required. I’ll be looking to buy this stock during the next market pullback.

The post A ‘Brexit-proof’ FTSE 100 dividend stock I want to buy for my ISA this year appeared first on The Twelfth Magpie.

More reading

• With a yield of 6.8% and a P/E ratio of 12.1, is this a dirt cheap FTSE 250 stock to consider?
• Will SpaceX, Nvidia, or Alphabet be the first $10trn stock?
• Up 95%! This FTSE 100 stock’s outperformed Nvidia over the past year
• With a 9.3% yield, is this an amazing opportunity to consider buying dirt-cheap Taylor Wimpey shares?
• How much do you need in a Stocks and Shares ISA to aim for £375 a week in retirement?

Edward Sheldon has no position in any shares mentioned. The Motley Fool UK has no position in any of the shares mentioned. Views expressed on the companies mentioned in this article are those of the writer and therefore may differ from the official recommendations we make in our subscription services such as Share Advisor, Hidden Winners and Pro. Here at The Motley Fool we believe that considering a diverse range of insights makes us better investors.