Technology is replacing human labour, helping employees be free from mundane and repetitive tasks. The use of robotics in automation is quickly gaining traction. Whether it’s a small company or a giant organisation, there are several robotic solutions available for performing myriads of roles.
According to a new study by Market Research Future, the global market for industrial robots is set to grow by more than 10 percent a year. TThe result of this is that there will be a huge transformation in the productivity and efficiency of industrial processes, resulting in higher levels of output, product quality, and flexibility.
With robotics having enormous potential in nearly every industry in every corner of the globe, robotics investments are becoming more attractive to investors.
Here’s what you need to consider when choosing an investment strategy that fits your needs and long-term goals.
- Look For Investments That Fit Within Your Existing Portfolio
One of the biggest mistakes that most investors make is to choose a fund just because the company is branded as a “Robo” solution. While these companies may be the current market leaders, they may already be included in your portfolio.
In today’s market environment, diversification is the key to making the most out of your investment. Therefore, it is good to invest in startups with limited weighting, regardless of the market cap or growth.
- Seek Guidance From Robotic Experts
Robotics is a complex, evolving industry. That said, it is difficult to predict the direction of the industry and the companies that are best positioned to support that trajectory.
The best way to have an accurate insight into emerging trends is to seek guidance from industry experts, academics, and entrepreneurs. They will help you understand the interaction between robotic technologies and their specific applications. As a result, you’re likely to become a key player in the industry with the strongest prospect for growth and revenue generation.
- Identify The Largest Growth Potential
Often, investors assume that big names with large market caps deliver great returns on investment (ROI). But it isn’t the case! Just as in any emerging sector, the tremendous potential for growth in the robotics industry lies in private or public small and mid-cap companies. Such companies offer the capabilities that feed multiple products for multiple geographies.
Simply put, investment in automation and robotics is more about leveraging the opportunities with broader growth, no matter the size or market cap.
- Go For Opportunities With Pure Robotic Exposure
Just because the index includes the word “Robo,” it doesn’t mean that it offers pure exposure to robotics. Sometimes, marketers choose the lead with “Robo” branding only to take advantage of the push towards robotics investment, but the holdings don’t reflect the name.
If you wish to boost your exposure in the industry, go for strategies whose holdings are directly connected with robotics, automation, and AI.
- Keep Costs To Minimum
When investing in robotic automation, do not take the financial hit for each trade. Instead, leverage the carefully selected portfolio. This will allows you to make necessary rebalancing and reallocation within the wrapping of the fund.
Besides, choose a fund that provides targeted exposure to robotics, automation, AI, and a stable performance track record. This will help you get the value you want.
In order to maximise return and minimise risk, you can invest in the EIS-eligible robotic business. EIS (Enterprise Investment Scheme) is one of the most generous investment schemes in the UK, as a result of which, you get EIS investment tax relief of upto 30%.
Final Words
There you have it – your handy guide to robotic investing and getting the best out of it. As more and more robotics strategies are coming to the market, we suggest you take the time to evaluate how each solution is designed and structured. Remember, there is the largest growth potential if the strategy is directly linked to robotics, automation, and AI.
