How investors can capitalise on Stephen Hawking’s insane prediction

It’s a wild world out there and things may be getting a little more insane after world famous theoretical physicist Stephen Hawking’s made six outlandish predictions to kick off 2018!

His prognostications have nothing to do with investment markets and are about humanity and the earth. He made these calls throughout 2017 and they included predictions that the earth will be unable to support population growth by the year 2600 and how climate change will turn Earth into Venus, where the temperate is 250 degrees Celsius and acid falls as rain.

But it’s his call for humans to start colonising other planets right away that has caught my eye. Hawking believes we have only about 100 years left on this planet thanks to a long overdue asteroid strike, climate change, epidemics and population growth.

A prediction like this from anyone else would be quickly made into a meme, but I’ll let people who are much smarter than me pass judgement on the likelihood of our time on Earth ending in a little more than one generation.

However, if his doomsday forbearing is taken seriously and we gear up for the biggest push into space that mankind has ever seen, it will have big implications for investors.

Coincidentally (or is it?), both the US and Australian governments have announced big plans for space exploration this year. President Trump has put NASA on course for a mission to Mars and beyond while Australia is creating its own national space agency to cash in on a $420 billion aeronautical industry.

The space industry is increasingly being driven by private companies and not governments as it was a few decades ago, and this means there are now more opportunities for investors to get exposure to this thematic.

The bad news is that there are currently very limited ways to ride the aerospace wave through the ASX, particularly for investors who only invest in blue-chip stocks.

There are a limited number of micro and small cap stocks that are related to the space industry. This includes nano-satellite company SKY and Space Global Ltd (ASX: SAS) and aerospace and defence company Electro Optic Systems Hldg Ltd (ASX: EOS).

Those looking at large caps will have to settle for companies that will benefit from the increase spending on aerospace in less direct ways.

The miners are the obvious ones as the building of space travelling vessels and other equipment to colonise planets will drive up demand for raw materials.

It’s no replacement for China but this could still be a meaningful tailwind for BHP Billiton Limited (ASX: BHP), Rio Tinto Limited (ASX: RIO) and South32 Ltd (ASX: S32).

The demand for space travel will also prove to be a boon for another industry that has caught the eye of the experts at the Motley Fool (but for other reasons).

Click on the link below to get your free report to find out what sector this is and the stocks you should be putting on your watchlist for 2018.

Happy travels!

Bill Gates Says This Could Be Worth "10 Microsofts"

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Motley Fool contributor Brendon Lau owns shares of BHP Billiton Limited, Rio Tinto Ltd., and South32 Ltd. The Motley Fool Australia has no position in any of the stocks mentioned. 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. This article contains general investment advice only (under AFSL 400691). Authorised by Bruce Jackson.

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