Investing in Cybersecurity & Digital Payments

Posted: Feb 21, 2015 12:01 AM

Are you profiting from digital payments and cybersecurity concerns?

As subscribers to my Growth & Dividend Report know, one of the key differentiators in how I select which companies we invest in is my proprietary PowerTrend framework.

One of the neat aspects of my 8 Great PowerTrends is you can see them taking shape around you in your daily lives.

Last week, one in particular was the beneficiary of a very big boost from one of the most unlikely of sources.

I’m talking about the federal government. It may be a slow-moving creature, but when the federal government adopts a new product, service or technology, it means a pronounced pick-up in overall adoption.

In other words, when the federal government gets behind something, it can make or break it. A great example was when the federal government switched from Diner’s Club cards to American Express. The move cemented American Express’s position and practically killed Diner’s Club.

After last Friday, we can now say the same for Apple Pay, Apple’s (AAPL) electronic payment technology that works on its iOS-powered devices, as the landscape moves away from Google Wallet. I have been an avid user of Apple Pay on my iPhone 6, and I have to say that just like Oreos, I love — simply love — it.

So what happened last Friday?

At a cybersecurity summit at Stanford University while speaking before President Barack Obama, Apple CEO Tim Cook slipped a few major Apple Pay announcements into his privacy-related talk. Beginning in September, Apple Pay will be “available for many transactions with the federal government,” including paying for admission at national parks.

Of course, this situation means the federal government will need to outfit various locations – national parks, museums, gift shops, passport offices and so on – with near-field communication (NFC) point of sale systems. Being able to accept Apple Pay and being able to complete the transaction are two very different things.

Second, the White House announced that it was working with big financial networks to enable Apple Pay for federal payment cards – specifically those for Social Security payments and veteran’s benefits. From my perspective, this announcement at a cybersecurity summit is a quiet endorsement of Apple Pay’s security. I’d expect this to mean that only more government agencies will be deploying Apple’s iOS-powered smartphones and tablets in the coming months.

Don’t underestimate the importance of security. A new report from the Internet security firm Kaspersky Lab mentions how hackers installed spying software on bank computers, learned how to mimic bank employee workflows and used the knowledge to make transfers into bank accounts they had created for this theft.

According to Kaspersky, more than 100 banks were hit with an estimated loss of $1 billion. If that math is correct, it would make this the most successful criminal cyber-campaign seen by Kaspersky.

Security is a key part of my Safety & Security PowerTrend, and, as my subscribers know, the only thing better than one PowerTrend is when two or more intersect.

That’s certainly good news for Apple and its smartphone and tablet volumes in the coming months. That, in turn, is good news for key suppliers like my Growth & Dividend Report recommendation – Qualcomm (QCOM). Click the link to see what else we’re adding to our Growth & Dividend Report holdings.

The shift toward mobile payments will be a medium- to longer-term one, but that doesn’t mean there aren’t short-term opportunities you can capitalize on.

In fact, there’s one right around the corner… and I’ll have my PowerOptions Trader subscribers positioned for the biggest gains…

You see, next week Fed Chair Janet Yellen will testify before Congress, giving her latest view on the economy, monetary policy – and at least drop hints as to when she and the Federal Open Market Committee may raise interest rates.

A few weeks ago, I shared the degree to which pronounced profits could be earned… by making strategic use of the calendar, be it earnings or economic related.

Remember, higher-divided-yielding companies were hit hard following the January Employment Report. But recent weak PMI and ISM manufacturing data – along with the lack of inflation amid a weakening global economy – give the Fed ample room to wait a bit longer when it comes to raising interest rates.

And I’ll exploit that many times over in my options-only trading service, PowerOptions Trader (which, my publisher adds, had the best track record among the many successful portfolios offered by Eagle Financial Publishing).

So… I’m very happy to report that – for the next few days – you can try out my PowerOptions Trader service for 60 days, and pay just $1.

Get started here.

In case you missed it, I encourage you to read my e-letter column from last week about how to make money in the stock market and my #1 long-term stock.