2020 was a tough time for the markets, with the FTSE 100 ending 14.3% lower, its worst performance since 2008. Many other indices worldwide endured a torrid time, too, with the IBEX 35 in Spain falling by 15.5%.
However, it wasn’t the case universally, as Nasdaq finished the year up by 43%. Part of the reason for the disparity is the prevalence of tech stocks. The sector isn’t well-represented in the FTSE 100, a stark contrast to Nasdaq’s tech domination.
Public demand for tech has surged in recent months, which is set to continue for the foreseeable future. This puts tech stocks in a prime position for the year ahead. Whether you choose to use CFD services to speculate on prices or prefer to purchase shares directly, tech offers genuine opportunities.
Here’s a look at some of the top tech stocks to take a look.
If you’re looking for a low-risk, solid tech stock, then it’s hard to see past Cisco. As a mature blue-chip company, Cisco offers the opportunity to invest in tech without decimating your portfolio.
Providing communications equipment, Cisco produces some of the most in-demand items right now, such as routers and switches, essential infrastructure goods for the digital highway. Paying shareholders a 3.2% dividend but only drawing on 57% of its profits to do so, it’s not hard to see why this is one that regularly tops investors’ lists.
One of the smaller tech stocks being tipped to follow, Sonos, has a valuation of approximately $2.7 billion and has proved that it has staying power. The home electronics company has products compatible with Spotify and Apple, other top-performing tech stocks, allowing it to piggyback onto its success.
Although wireless streaming tech is a very competitive market right now, Sonos has already demonstrated that it’s more than capable of holding its own. The success yet relatively small size might even make it a target for acquisition, another reason to invest.
Often described as the Chinese version of Amazon, Alibaba has enjoyed considerable success. It’s notched up more significant growth in the last five years than the US retailing giant, 46.2% compared to just 25.8% for Amazon.
With a huge and expanding customer base, Alibaba is hotly tipped to continue to proliferate into 2021 and beyond.
With so much controversy around the use of social media and its influence, the idea of investing in Facebook stocks may sound risky. However, with its collection of apps that include Facebook and Messenger, WhatsApp, and Instagram, there are 3.21 billion active users every month.
There may be some interference from regulators, and that is the biggest concern for this stock. However, even if a sell-off of WhatsApp and Instagram is forced as rumored, the switch to stand-alone companies could bring even greater value to existing shareholders.