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The Top 10 Tech Stocks to Buy Before the 2020 Election

InvestorPlace Logo By Alex Sirois of InvestorPlace | Slide 1 of 11: The current investor sentiment around tech stocks is a polarizing one. Investors have a lot to consider with the upcoming election upon us. They also need to factor in the general performance of tech stocks this year, and consider how they might see these stocks perform moving forward.  Factors fueling worry here include a general sentiment that Democrat leaders are likely to impose stricter laws on large tech companies. Upcoming regulatory woes along with the sentiment that tech stocks are due for a correction characterize the narrative to rotate out of tech.  There was already strong sentiment from the left that these companies have been too dominant in the U.S. economy, and are anti-democratic. Recent news the form of a 449 page Congressional report adds fuel to that fire. Pundits expect that democrats will use the findings therein to bring forth bills against the large tech companies.  One question to consider is the timeline of potential regulation. That is, if large-cap tech stocks find themselves under new regulations, when will that occur? Any bills will likely be introduced after the new year and into 2021 if Biden is elected. When such bills would be enacted is a harder question to answer. This answer from a former U.S. Congress employee suggests an average of 263 days, and a mean of 215 days. So, any new regulations would likely become law by mid-to-late 2021.     Tech giants aside, it’s also important to answer the question of which tech sectors should fare well in an economic recovery. A recovery looks likely to gain momentum on news that a vaccine will be available to all Americans by sometime mid-2021.  Yes, tech stocks have driven the markets through this year. So, investors should at least question whether they are overweight. Yet, investors must also consider why so much capital has flowed into tech stocks in the first place.  Jack Ablin, Chief Investment Officer at Cresset Wealth Advisors remains pro-big tech. His bull thesis: “People have to keep in mind that the five largest tech companies make more in earnings than the entire Russell 2000 combined, so this isn’t the internet bubble.”  Michael Farr, president of Farr, Miller & Washington LLC contends that fundamentals are driving capital into big tech, and a divestment due to current headwinds would be “a sucker’s trade.”            10 Best Stocks for 2020: Megatrends Support This Year's Biggest Winners          With all of that in mind, here are 10 tech stocks to buy for 2021:  Google (NASDAQ:GOOG, NASDAQ:GOOGL)  Microsoft (NASDAQ:MSFT)  Intel (NASDAQ:INTC)  Advanced Micro Devices (NASDAQ:AMD)  Facebook (NASDAQ:FB)  Amazon (NASDAQ:AMZN)  Taiwan Semiconductor (NYSE:TSM)   Apple (NASDAQ:AAPL)  Salesforce (NYSE:CRM)  Nvidia (NASDAQ:NVDA) A brief look at this list reveals my thesis: big tech will remain strong in 2021 and semiconductors will too. 

The Argument for Staying the Course

The current investor sentiment around tech stocks is a polarizing one. Investors have a lot to consider with the upcoming election upon us. They also need to factor in the general performance of tech stocks this year, and consider how they might see these stocks perform moving forward.  Factors fueling worry here include a general sentiment that Democrat leaders are likely to impose stricter laws on large tech companies. Upcoming regulatory woes along with the sentiment that tech stocks are due for a correction characterize the narrative to rotate out of tech.  There was already strong sentiment from the left that these companies have been too dominant in the U.S. economy, and are anti-democratic. Recent news the form of a 449 page Congressional report adds fuel to that fire. Pundits expect that democrats will use the findings therein to bring forth bills against the large tech companies.  One question to consider is the timeline of potential regulation. That is, if large-cap tech stocks find themselves under new regulations, when will that occur? Any bills will likely be introduced after the new year and into 2021 if Biden is elected. When such bills would be enacted is a harder question to answer. This answer from a former U.S. Congress employee suggests an average of 263 days, and a mean of 215 days. So, any new regulations would likely become law by mid-to-late 2021.     Tech giants aside, it’s also important to answer the question of which tech sectors should fare well in an economic recovery. A recovery looks likely to gain momentum on news that a vaccine will be available to all Americans by sometime mid-2021.  Yes, tech stocks have driven the markets through this year. So, investors should at least question whether they are overweight. Yet, investors must also consider why so much capital has flowed into tech stocks in the first place.  Jack Ablin, Chief Investment Officer at Cresset Wealth Advisors remains pro-big tech. His bull thesis: “People have to keep in mind that the five largest tech companies make more in earnings than the entire Russell 2000 combined, so this isn’t the internet bubble.”  Michael Farr, president of Farr, Miller & Washington LLC contends that fundamentals are driving capital into big tech, and a divestment due to current headwinds would be “a sucker’s trade.” With all of that in mind, here are 10 tech stocks to buy for 2021: Google (NASDAQ:GOOG, NASDAQ:GOOGL) Microsoft (NASDAQ:MSFT) Intel (NASDAQ:INTC) Advanced Micro Devices (NASDAQ:AMD) Facebook (NASDAQ:FB) Amazon (NASDAQ:AMZN) Taiwan Semiconductor (NYSE:TSMApple (NASDAQ:AAPL) Salesforce (NYSE:CRM) Nvidia (NASDAQ:NVDA) A brief look at this list reveals my thesis: big tech will remain strong in 2021 and semiconductors will too. 
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