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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
by 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 agoThey 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 agoMaybe. 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 agoCommoditization 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.