Are you looking for stocks that can help you earn solid returns in the long run while ensuring that your capital is protected from huge drawdowns? If so, it makes sense to put your money into stocks riding secular tailwinds in high-growth areas such as cybersecurity, big data, and observability. Since these services are critical for the smooth functioning of businesses, these investments can prove to be quite resilient in the current uncertain macroeconomic environment.

Investors can put as little as $500 -- money which is not required to cover contingencies or expenses -- in each of the high-quality companies such as Okta (OKTA 3.04%) and Splunk (SPLK) to start building wealth now.

1. Okta

The first no-brainer stock to buy with $500 capital is leading cloud-native identity and access management player Okta. It's already been a force to reckon with in workforce identity management -- verifying employee identities to govern data and system access while preventing insider threats. Now Okta has strengthened its position in customer identity and access management by acquiring competitor Auth0 in May 2021. The company now estimates its total addressable market to be $80 billion. With an annual run rate of just $2 billion, there is still much runway ahead.

Okta managed to report encouraging fourth-quarter and fiscal 2023 results (ended Jan. 31, 2023). While quarterly top-line growth has moderated slightly due to reduced corporate spending, the company reported a 15.2 percentage point year-over-year improvement in non-GAAP (adjusted) operating margin to 9% and a 12.8 percentage point year-over-year improvement in free cash flow margins in the fourth quarter. With 96% of the company's total revenues coming from stable subscriptions, investors have significant revenue visibility.

Okta increased its customer count by 17% year over year to 17,600 at the end of fiscal 2023. The company has also been quite successful in cross-selling additional security modules to existing customers, as is evident from the dollar-based net retention rate of over 120% in fiscal 2023.

Okta already partnered with several technology players, including software, networking, and cloud platform vendors, to further expand its reach. The integration network has helped entrench the company's offerings in customers' operations, making it difficult for the latter to switch to the competition. With the company now expecting to return to non-GAAP profitability in fiscal 2024 (guidance of $136 million to $145 million) from a $10 million loss in fiscal 2023, investors can consider picking up a small stake in this cybersecurity specialist.

2. Splunk

The second stock to buy with $500 is the leading security and observability player. The company reported impressive fiscal 2023 results (ended Jan. 31, 2023). Investors, however, have been disappointed with its weak outlook for the first quarter of fiscal 2024 due to a slowdown in new deals and expansions amid increasing macroeconomic uncertainty.

However, there are several factors working in favor of Splunk. The increasing adoption of cloud computing and remote working has dramatically increased the complexity of enterprise IT infrastructure. To ensure that these digital assets are protected from disruptions and downtime, it is essential to monitor IT infrastructure, security threats, potential fraud, and business processes, as well as to ensure appropriate management and response to such events.

Starting in 2019, the company has been transitioning from a perpetual license-based business model to a subscription-based business model. While this has resulted in a temporary decline in revenues and margins, it will result in higher revenue visibility in the coming months. Investors are generally ready to pay higher valuations for companies with predictable revenue streams.

Splunk added 115 new customers bringing the large customer count (customers with annual recurring revenue over $1 million) to 790 at the end of fiscal 2023. Additionally, more than 90 Fortune 100 companies are using the Splunk platform. Increasing adoption by large customers in the current precarious environment is testimony to the superiority of Splunk's security and observability platform.

Further, Splunk has been focusing on controlling costs by prioritizing business-critical projects, reducing the workforce by 4%, allowing for only essential noncustomer-facing travel, and reducing or relocating the usage of global real estate. These moves will boost the company's margins in the coming quarters. Additionally, Splunk generated $427 million in free cash flow in fiscal 2023, more than four times what was reported in the prior year.

Splunk expects its total addressable market to be over $100 billion. With an annual run rate of just about $3.6 billion, there is still significant scope for the company to grow in the coming years.