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This is just armchair analysis, but my perception from easily Googleable sources on mining & resource companies for battery tech is that it doesn’t actually loo

by mlthoughts2018 7y ago

This is just armchair analysis, but my perception from easily Googleable sources on mining & resource companies for battery tech is that it doesn’t actually look like a good investment for casual investors. The lithium market seems crazy and susceptible to high volatility from Chinese stockpiles. Meanwhile, battery technologies, even at the high end, are becoming rapidly commoditized and experiencing price wars, meaning new investment even into state of the art battery tech probably isn’t exposed to a lot of upside because all the consumer markets it can feed into will have consumers expecting the highest quality at bargain basement prices. The exceptions will likely be highly industry-specific and involve complex military or enterprise consumers with special needs, and I doubt casual investors will have access to information necessary to reliably speculate about those opportunities.

darkerside 7y ago
Seems to me that an immature market that is on its way to becoming a commodity is a great time to invest, as opposed to post commoditization
- maxerickson 7y ago
  They caveat their comment with "casual investors". To win, you'll probably have to have a quite wide basket or get lucky and pick the right companies.
- philipkglass 7y ago
  Maybe. That could have described the solar photovoltaic manufacturing business in the first decade of the 21st century, but it would have been a real gamble making money trying to invest in any of the individual companies or even baskets of companies. Commoditization comes quickly, and with "too much" competition even proprietary advances benefit buyers more than manufacturers. The fracking revolution looks similar, for that matter. So far it has delivered a lot more value to buyers of fossil fuels than to producers.
- JamesBarney 7y ago
  Commoditization drives down profits which will limit the returns on your investment. Generally you want to invest in complements to things that are going to be commoditized. The drop in price and profits for the commodity drive increased profits for the consumer of the commoditized good.

darkerside 7y ago

Seems to me that an immature market that is on its way to becoming a commodity is a great time to invest, as opposed to post commoditization

maxerickson 7y ago
They caveat their comment with "casual investors". To win, you'll probably have to have a quite wide basket or get lucky and pick the right companies.
philipkglass 7y ago
Maybe. That could have described the solar photovoltaic manufacturing business in the first decade of the 21st century, but it would have been a real gamble making money trying to invest in any of the individual companies or even baskets of companies. Commoditization comes quickly, and with "too much" competition even proprietary advances benefit buyers more than manufacturers. The fracking revolution looks similar, for that matter. So far it has delivered a lot more value to buyers of fossil fuels than to producers.
JamesBarney 7y ago
Commoditization drives down profits which will limit the returns on your investment. Generally you want to invest in complements to things that are going to be commoditized. The drop in price and profits for the commodity drive increased profits for the consumer of the commoditized good.