If you want to be an effect tech investor, it pays to know which of the small things are going to blow up into big things in the next few years. This article can help.

Each year, the Consumer Electronics Association puts together a list of trends to watch for the coming year and beyond. One of the biggies last year was the Internet of Things, or IoT. To show you how spot-on that was, almost everything on this year's list is related to IoT.

The CEA went with very broad trends this year, and within each is a large number of investing possibilities. I chatted with CEA's Jeff Joseph about each of the five biggies:

1. The Rise of the Machines
2. Digital Health and the "Quantified Self"
3. Entertainment and Immersive Content
4. The Acceleration of Disruptive Businesses
5. Big Data Analytics

The details are in the video below.


The first tech trend we need to be aware of sounds like something from a Stephen King novel -- the rise of the machines.

Jeffrey Joseph: The rise of the machine sounds so ominous, but really it's not. It's about the rise of robots and the robotics in our lives. Whether you're talking about drones and the role they may play; whether you're talking about robots that clean up after us; whether you're talking about robots that serve people who may be incapacitated in some way; we're seeing great growth in that category.

To understand why this an important and exciting trend, think of this equation:

Smarter Computers + Robotics + Cloud = The Jetsons (almost)

We're talking about self-driving cars, Amazon.com (NASDAQ:AMZN) drone deliveries, and virtual personal assistants that easily understand your voice commands to perform an amazing variety of tasks for you. Like Siri on steroids. Like Rosie the Robot!

The second big trend is digital health and what's known as "the quantified self."

Jeffrey Joseph: When we talk about the Internet of Things, we can see how it's playing out in digital health. We started with these fitness bands that measure the amount of steps we take; measure our sleep. Now we're taking a deeper dive. We have apps that will collect all that data, report back on it and allow you to do something with it. You may share it with your doctor [or] you may share it with yourself to figure out how to have a better and healthier life through the use of that data.

Personal electrocardiograms, pulse oximeters, heart rate, glucose, and blood pressure monitors. We're talking about a world in which the connectivity of these devices gives your doctors much better data than they had before, and can drastically cut down on your number of office visits.

A bonus investing idea -- all that personal, private, sensitive data must be transmitted and stored securely.

Our third big trend is a new era of entertainment and immersive content. 

4K Ultra High Definition television is the first thing that comes to mind. And despite some early skepticism, Joseph says these TVs are already among the fastest-selling products in the history of consumer technology.

Jeffrey Joseph: We've already seen prices decline. The key is always about content and we're seeing more and more content become available. We're seeing streaming services like Netflix and Amazon come online. We're very close to having a disk format where there's Blu-ray 4K with some disc format that will provide it. Ultimately we'll see cable and satellite providers and maybe, someday, even broadcasts. So, once more content comes, we'll really see it explode.

There's much more to this trend than 4K TV. When we say "immersive," we're talking completely engulfing our senses. Think about really feeling a sporting event through motion or vibration. And of course we can totally immerse visually through virtual reality devices, like the Oculus Rift. Facebook (NASDAQ:FB) has given us a hint of what it thinks about this area, by paying $2 billion for Oculus.

We can also get ready for the best listening experience we've ever had, as high-resolution audio from the likes of Sony (NYSE:SNE) and Pioneer makes its way into our homes.

Our fourth trend: Disruption continues to accelerate.

Jeffrey Joseph: We're seeing what we call disruptive business models. Companies like Uber that are completely disrupting the personal transportation system. Or Airbnb, that's completely disrupting the hotel and motel industry. We call these disruptive companies that are changing business models and providing consumers more information, more choice, and more personalization.

Uber's latest round of financing pegs its valuation at an staggering $40 billion. It's put a big dent in traditional taxi services -- especially in San Francisco. Our own Morgan Housel predicts further blues for Yellow Cabs, and expects the same thing to happen to radio stations thanks to Spotify and other streaming music services.

Our final trend ties together all the others -- and that's the predictive power of big-data analytics.

Jeffrey Joseph: Big data refers to the compilation of all that data. We talked about all these devices that now have sensors and they're connected. They're collecting all this data, so it raises a lot of issues about privacy, security, and again, what do you do with that information? How do you make it actionable? So, we're beginning to explore that next generation. We've collected the stuff. Now what the heck do we do with it?

Big data encompasses nearly every aspect of our lives, and the real potential for the billions and billions of bytes being collected is the use of analytics to make sense of it. Handled properly, all that data can help us with credit card fraud detection, predictive maintenance that can reduce factory downtime, and disease prevention and control.

More data sources, and more computing power, will only stoke the fire of big data analytics in the years to come.

Talking trends with CEA's Jeff Joseph in New York City, I'm Motley Fool analyst Rex Moore.

Rex Moore owns shares of Facebook. The Motley Fool recommends Amazon.com and Facebook. The Motley Fool owns shares of Amazon.com and Facebook. Try any of our Foolish newsletter services free for 30 days. We Fools may not all hold the same opinions, but we all believe that considering a diverse range of insights makes us better investors. The Motley Fool has a disclosure policy.