Loved and followed by private investors, one of Britain’s – if not the world’s – most popular and successful investors and entrepreneurs, Jim Mellon, talks to PR and IR expert Stefania Barbaglio about the next big things in the investment sphere. With technology developing at an incredible speed, this shaping of economy and society is being reflected in market trends.
Watch the full interview with Jim Mellon:
Longevity assets, biotech, battery metals and blockchain are some of the hottest trends investors should be looking more closely at next year.
Living longer and living better: Longevity is the big money fountain
Jim is a recognised market guru, well known for recognising investment opportunities before they become mainstream. His journey in biotech, life-sciences and technology has now led him to turn his focus towards longevity investment.
“The longevity industry will be bigger than technology, alternative energy, transportation, education and the rest of the ‘zeitgeist’ sectors put together.” (Juvenescence: Investing in the Age of Longevity by Jim Mellon. See juvenescence-book.com)
Jim is intrigued and fascinated by human resilience and its ability to overcome barriers. For the first time in human history, we are being able to afford a longer and healthier life, with life expectancy in developed countries reaching over 100 years for the current younger generation. They will become what he calls the ‘wellderly’: those who are in excellent shape at an older age.
Bridging the gap between our lifestyle and the current economic model is the only way to ensure financial stability. Reforming the pensions and retirement system is key to keeping the economy sustainable, says Jim. He goes further: it is going to be common for people to switch careers and pursue a variety of aspirations over the course of a lifetime.
The pensions market regulation is outdated and inefficient. If it worked well a couple of decades ago, it now needs to be revamped. As a life insurance policy is not such an attractive idea for a person who is going to live healthily until 100, it feels like this money could be put to better use… This is where the life settlement market comes in: where customers, insurers and third parties get together to reach an agreement on maximising opportunities for all parties.
Lithium and electric cars boom
The battery metals market keeps on heating up and is set to keep doing so for the next few years. The reason? Electric vehicles (EVs). EVs are emission free as they run on lithium-ion batteries. They are an essential part of the EU and China’s plans to transition to a clean, green economy.
EV sales are 63 percent up in the third quarter, compared to last year’s Q3. However, the lithium market is still way behind the curve in terms of where the electric vehicles market is going to be, says Jim. Obtaining lithium involves quite a lengthy process. The best way to mine it is by the evaporation of highly concentrated lithium brine, which can take a number of months, depending on weather conditions.
Lithium is the favourite among the battery metals. It has been described by some analysts as “white petroleum”, which could help the world move away from its dependence on fossil fuels and into a new era of battery-powered energy. Lithium-based batteries are lighter, charge faster and are able to store more energy than traditional ones, making them a strong contender to “replace gasoline as the primary source of transportation fuel”, according to analysts at Goldman Sachs, which published a report in December 2015 predicting that the size of the global lithium market could triple by 2025.
Lithium demand is skyrocketing as mega factories, especially in China, are smashing through the lithium supply. Prices already reflect the supply and demand struggle: lithium prices are 35 percent up this year, and cobalt – another key element for batteries – is up more than 127 percent.
One company for your watchlist: Zenith Minerals (ASX: ZNC)
Bitcoin or Blockchain?
Bitcoin is a bubble, blockchain is a revolution, Jim believes. Bitcoin is not a reference currency, so much of the buzz around it now is speculation, not real value. Its fluctuating price makes it untrustworthy as a currency.
Much has been said about blockchain, and its potential is only starting to be unlocked. Blockchain provides a new way to do business because it eliminates the need for middlemen, reducing costs and speeding up transactions. On top of that, blockchain enhances security because it builds up a transparent network from a distributed ledger.
Embracing this progress, banking and financial services are starting to apply blockchain to their platforms, and play with digital currencies. This is the case for six global banks: Barclays, Credit Suisse, Canadian Imperial Bank of Commerce, HSBC, MUFG and State Street, the last having announced the creation of a digital currency in late August.
The blockchain revolution has just started and more news is flowing. Watch this space.
One company for your watchlist: On-line PLC (LON:ONL)