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in 2030:
10 predictions for
long-term investors
This isn’t science fiction
The world in 2030 may seem a long way off, but at Capital Group
we spend a lot of time thinking about the distant future.
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1. Health care innovation will reach warp speed
Star Trek depicted a far-off future where space explorers traveled in diagnostics may lead to earlier detection of illnesses, or in
the galaxies equipped with cutting edge technology such as the some cases treat disease before it progresses. Genetic testing
tricorder, a hand-held medical device that scanned a person’s vital equipment maker Illumina and research and manufacturing
signs, issued a diagnosis and prescribed treatment in minutes. company Thermo Fisher Scientific are providing services to a host
While I don’t think we’ll have tricorders, I suspect that by 2030 of drug developers. One of the most exciting things is the liquid
many of us will have devices that will analyze blood, do cardiology biopsy, whereby a sample of your blood can be used to identify
monitoring and even remotely check our breathing while we cancer at its earliest stages.
Rich Wolf
sleep, some of which are readily available.
is an equity portfolio
manager with 23 years
Much of the recent focus has been on the pandemic and vaccine
experience.* He also has We are already experiencing a massive wave of innovation development. These are very important, but we have also been
research responsibilities for across the health care sector that will drive new opportunity looking over the horizon, trying to determine how health care will
U.S. medical technology for companies, potentially reduce overall costs and, most transform itself and how we can invest in those shifts.
companies and is a manager importantly, improve outcomes for patients. Breakthroughs
for The New Economy Fund.®
*As of December 31, 2020. Sources: Industry & government data, Kagan estimates, Standard & Poor’s. Data compiled June 2020. Values in USD.
60
40
20
0
2014 2015 2016 2017 2018 2019 2020 2021 2022 2023
ESTIMATES
*As of December 31, 2020. Source: Statista. 2019 through 2023 are estimates.
Asia-Pacific
400 Europe
North America
Rest of world
300
200
100
0
2016 2017 2018 2019 2020E 2021E 2022E 2023E
Source: World Payments Report 2020 from Capgemini. 2020–2023 are estimates. Figures reflect all non-cash payments. No third party whose
*As of December 31, 2020. information is referenced in this report under credit to it, assumes any liability towards the user with respect to its information.
Most of this will be through products we already have — phones Over the next decade, I expect chipmakers to be working
Steve Watson
and tablets, automobiles, entertainment systems and appliances. overtime to satisfy the robust demand for semis across industries.
is an equity portfolio
Wearables are becoming more sophisticated and will help us In my portfolios I’m interested in companies that may be
manager with
33 years experience.* track our workouts, sleep and overall health. These devices will misunderstood by the market but are working on transformative
He is a manager for feel familiar, but we’ll be able to use them in ways we never could ideas to change daily life.
New Perspective Fund. before.
34% 32%
14%
11% 9%
*As of December 31, 2020. Source: Bloomberg. Data represents the share of all semiconductor device applications in 2025, as forecast by Bloomberg.
15
10
0
2020 2021 2022 2023 2024 2025
*As of December 31, 2020. Source: IDC (report #US47225121). 2021-2025 are forecasts from IDC, as of January 2021.
Sources: Capital Group. Broadway show cost from Jefferies, as of July 2019. NBA ticket cost from Barrytickets for 2018–19 season. Console video game cost from
*As of December 31, 2020. Business Insider, as of October 2018. Video streaming cost is for a standard monthly Netflix subscription as of December 2020.
I think the restaurant sector may look very different in 10 years. Many
restaurants have reinvented themselves during the COVID era, and I
think those that are able to adapt to shifting customer preferences will be
the most successful. I expect we’ll continue to see the ghost kitchen
concept — where you have the equipment and facilities to prepare meals,
but the value will be in providing customers with the options of dining
and entertaining at home. Potential winners outside the food industry may
include retailers of athletic casual wear, home improvement, furniture
and décor.
Even if older generations spend less time in cities, I still expect young
adults will flock to them. Cities will just recreate themselves, as they have in
the past. The impacts of such a structural shift present an opportunity for
investors who think long term.
*As of December 31, 2020.
200
150
28% annualized growth
100
50
0
2018 2019 2020 2021 2022 2023 2024 2025 2026 2027 2028 2029 2030
*As of December 31, 2020. Source: IEA, Electric vehicle stock in the EV30@30 scenario, 2018—2030, IEA, Paris. Data for 2020—2030 are forecasts, provided by IEA.
Hydro Solar
80
Nuclear 56%
Wind Solar and
60 Oil Wind
by 2050
Gas
40 74%
Renewables
Coal by 2050
20
24%
Forecast Fossil fuels
0 by 2050
1970 1980 1990 2000 2010 2020 2030 2040 2050
Source: Bloomberg, New Energy Outlook 2020, a detailed study on global energy demand and supply conducted by 65 analysts for Bloomberg New Energy
*As of December 31, 2020. Finance. “Other” includes geothermal, biomass, etc.
Home Depot
Boston Scientific
Amazon CSX Transportation
Netflix
Shopify
Teladoc Health
*As of December 31, 2020. Source: Capital Group. Company examples are for illustrative purposes only.
Capital Group
1 3 5 8 emphasis (years)
Industry
Source: Capital Group. Compensation paid to our investment professionals is heavily influenced by results over one-, three-, five-and eight-year periods, with
*As of December 31, 2020. increasing weight placed on each succeeding measurement period to encourage a long-term investment approach.
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