In an article published on the ASX, Mr Neilson outlined a number of industries being driven by digitsation where one could find “emerging opportunities”.
“Innovation and the rate of change are obviously important from an investment perspective,” Mr Neilson wrote.
“New companies will emerge, offering spectacular returns, and in many instances, it will be at the cost of other companies that will struggle to stay relevant.”
He earmarked artificial intelligence (AI), autonomous driving, the manufacturing industry and ‘additive manufacturing’ (or 3D printing) as areas in the midst of development.
Platinum Asset Management would be managing clients’ funds “with this creative destruction in mind,” Mr Neilson wrote.
Graphic processing units, designed initially for video games, had numerous AI applications such as “machine learning, enabling computers to see, converse, navigate and create” as well as “multitudes of other developments”.
Autonomous driving, far from being a “distant moon-shoot experiment, was “real and is here now”.
Furthermore, digitisation was not simply confined to product innovation but also impacting manufacturing processes, Mr Neilson pointed out.
For instance, German industrial companies were leading the charge by using “digitisation platforms to transform manufacturing processes” where “machines and work-pieces directly communicate with each other via ubiquitous wireless connectivity and, ultimately, make autonomous decisions about the next production step”.
Automotive manufacturers as well as start-ups were utilising ‘additive manufacturing’, virtually synonymous with 3D printing, to create lighter and more fuel-efficient engine parts (as in the case with General Electric), or in other instances to use 3D printing to create “fully functional bridges and houses”.
“These are just some of the themes to which we at Platinum have been paying close attention when building our portfolios.
“There are more. Gene therapy, precision medicine and big data are transforming disease treatment and prevention,” Mr Neilson wrote.
“The reality is that these technologies are very much already here. Funding for all these innovations is aided by cheap capital.”
