Momentum traders sometimes say, "The trend is your friend -- until it ends." The idea is that you can make money from short-term trends in stocks and other assets, but those trends don't always last long.
However, long-term investors can profit from some ongoing macro trends that aren't directly connected with asset prices. And these trends are likely to persist for decades. Here are five unstoppable trends to invest $5,000 in for 2023.
1. Artificial intelligence
Artificial intelligence (AI) has already changed the world in multiple ways, from credit card fraud prevention to virtual assistants. That's only the tip of the iceberg, though. The ChatGPT chatbot recently unveiled by OpenAI provides a glimpse into what AI could potentially do. Major advances in the technology over the next 20 years and beyond could radically transform society.
Among the great AI stocks that you could buy right now, I think Alphabet (GOOG 0.74%) (GOOGL 0.55%) especially stands out. The company already employs AI extensively in its search algorithms. Its Google Cloud unit hosts AI apps for other organizations. Its DeepMind unit is one of the pioneers in AI. And its Waymo business is a leader in self-driving car technology.
Some might think that chatbots such as ChatGPT could be Google killers. But in my view, it's much more likely that Alphabet will embed its own chatbot into Google Search in a way that provides users with even better results.
2. Digital payments
Will cash completely disappear in the future? Maybe, maybe not. However, digital payments will almost certainly be more widely adopted. Global accounting and consulting firm PwC projects that digital payment transaction volumes will more than double by 2030.
Investors have plenty of attractive fintech stocks to consider, but I'd put Mercadolibre (MELI -1.79%) near the top of the list. The company is best known as the leader in Latin American e-commerce. However, MercadoLibre also offers fintech solutions in the region. This business is booming. Many people in Latin America don't have access to traditional financial services. MercadoLibre provides a much-needed solution for them.
3. Healthcare innovations
There are actually multiple unstoppable trends that are improving healthcare. Gene editing holds the potential to cure genetic diseases. Advances in immunotherapies are helping fight cancer and other diseases. Wearable devices are making real-time monitoring of health conditions much easier. Robotic surgical systems are improving patient outcomes. And that's just a start. I've lumped all of these into one bucket -- healthcare innovations.
It wasn't easy picking just one stock to buy as an investment in this broad trend. But I do really like Vertex Pharmaceuticals (VRTX -1.02%). The big biotech has a monopoly in treatments that address the underlying cause of cystic fibrosis. Vertex and its partner, CRISPR Therapeutics, could also win regulatory approvals in 2023 for exa-cel, the first CRISPR gene-editing therapy on the market. Exa-cel holds the potential to effectively cure the blood diseases beta-thalassemia and sickle cell disease. Also, Vertex's pipeline is loaded with promising candidates, including a potential cure for type 1 diabetes.
4. Quantum computing
Quantum computing is hard to wrap your head around. That's because it harnesses the power of quantum physics, which features some pretty wild concepts. What's most important to understand about quantum computing, though, is that it could be blazingly fast and revolutionize multiple areas in the technology world, including machine learning and simulation.
As is the case with our other unstoppable trends, there are several great quantum computing stocks you can buy. Microsoft (MSFT 0.37%) ranks among the best, in my view. The tech giant describes its Azure Quantum as "the world's first full-stack, open-cloud quantum computing ecosystem." It's quite possible that Microsoft will play just as big of a role in quantum computing as it has in PCs and office productivity.
5. Renewable energy
No, the world is not going to stop using fossil fuels overnight. However, the ever-increasing use of renewable energy sources to meet our needs appears to be a near certainty. Countries and corporations across the world have committed to aggressively reducing their carbon emissions over the next several decades.
Brookfield Renewable (BEP) (BEPC -0.09%) stands out as one of the top renewable energy stocks, in my opinion. Its hydroelectric, wind, solar, and distributed energy facilities currently generate a combined capacity of 24 gigawatts. Brookfield Renewable's development pipeline could more than quadruple that total.
In addition to its solid long-term growth prospects, Brookfield Renewable also offers an attractive distribution with a high yield. The company has increased its payouts at a compound annual rate of 6% since 2001.
