Investor enthusiasm seems to be going through the roof and already-stretched valuations are going even higher. While a buoyant market is good news and a good earnings season is the perfect reason for the bulls to rule, it’s hard to over stress the need for caution.

Estimates for the third quarter have been corrected. Many companies continue to point to uncertainties for not providing annual guidance. The elections are around the corner. There’s a lot of waiting to happen this year that could have a significant impact on the stock market.

This seems to be a good time to take stock of our longer-term perspectives and invest for the future. So let’s take a look at some longer-term trends that you should be invested in-

Everything is moving to the cloud

This is the biggest trend and much has been written and said about this, so we are really already familiar with the fact that workloads are moving to the cloud, entertainment is moving to the cloud, education is moving to the cloud, e-commerce happens with its help, healthcare is increasingly moving to the cloud, our AI-powered future will happen from the cloud, and so on.

So there really isn’t anything much more to add. What it means from the investment angle is that there are many ways to play this and increase our exposure to the cloud. And depending on valuations (the whole space is overvalued to varying degrees), we can invest in infrastructure, software, hardware including chips and so on.

Stocks: While the FAANG stocks, Microsoft (MSFT - Free Report), (NVDA - Free Report), (AMD) are the most talked about, these stocks understandably have stretched valuations right now. A stock like Dropbox (DBX) is a way to tap growth at low valuations.

E-Commerce is here to stay

E-Commerce has grown in leaps and bounds over the last few years but there doesn’t seem to be any slowdown on the horizon. Instead, the categories served by e-commerce continue to expand. While online-first players like Amazon (AMZN - Free Report) hog the center stage, most traditional players have some kind of online presence today, which could be either their own website or a storefront on Facebook (FB - Free Report). There is tremendous growth waiting to happen in this space and even more so, if you consider the global opportunity. So you should definitely have some exposure here.

Stocks: As with most technology companies, the big names in e-commerce are overvalued. But Groupon’s (GRPN - Free Report) valuation looks reasonable at the moment. If you’re willing to wait for the right time for exposure to China, Alibaba (BABA) is the best choice. JD.com (JD - Free Report) or Autohome (ATHM) also doing good but you may want to wait for a more reasonable valuation to jump in. Another stock worth looking at is Cars.com (CARS) because like ATHM, it leverages a growing trend of people buying cars online.

Automotive ownership moving toward EVs

The main factors standing in the way of broader adoption of EVs are the cost and President Trump’s negative stance on environmental protection and sustainable transport.

But materials science is moving forward to make batteries lighter, faster, cheaper, safer and easier to charge. China has taken the lead in the first round, with its NMC 811 (that’s nickel-manganese-cobalt in the proportion of 8:1:1) batteries and South Korea is also moving in the same direction. Tesla is expected to have an 811 version by year-end. While increasing the proportion of nickel improves performance, there’s also increased risk of fires. Moreover, cobalt is relatively rare and expensive. Most of the materials research in the U.S. currently done by American universities but the evolution of the battery will take several years. Adjusting NMC proportions will in the meantime allow for some cost reduction and facilitate adoption.

Meanwhile, the American Energy Innovation Act (introduced in the Senate) and the Climate Leadership and Environmental Action for Our Nation's Future Act (introduced in the house) this year, are leading to the encouraging possibility of government funding for advanced vehicle development and manufacturing. Technology thus developed can be licensed broadly to all industry players, which will drive the dynamics for quicker EV adoption.

Adoption is faster in Europe because of government mandates and ambitious targets for CO2 emissions.

Stocks: Tesla (TSLA - Free Report) is the obvious one here but its shares are overvalued. Among traditional players, both Peugeot (PUGOY) and General Motors (GM - Free Report) are good choices. Peugeot EVs are already popular, particularly in Europe. GM is also in the race and expects to have 20 models by 2023.

Increased focus on health and wellness

The rising cost of healthcare has made it increasingly obvious that prevention is a better way to deal with health issues. Health insurance companies really want you to take care of your health. And consumers to have grown much more aware. If anything, the pandemic has strengthened this trend.

When buying food for example, you are checking labels to see if the food is natural (no artificial preservatives, colors or flavors), organic, non-GMO, whether it contains the fattening high fructose corn syrup (HFCS), whether it’s gluten-free, etc. Some would even check for plant-based, grass-fed, A2 or soy-free. This wasn’t the case a few years back. And a few years down the line, there will be even greater awareness. So the trend will strengthen.

The layer that the pandemic introduced is food-at-home. While restaurants are not going out of trend (many people are just dying to get back out there), there is greater awareness of the risks. So some of the strength that grocers are seeing is going to stay.

The focus on the right kind of food is developing into broader trend that also includes daily exercise, better sleeping habits and so on.

Stocks: Grocers SpartanNash (SPTN) and Sprouts Farmers Market (SFM) look good here. SpartanNash is in the food distribution business, both to its own and other retail outlets, to e-commerce companies and military commissaries. Sprouts has its own retail stores that are geared to target health enthusiasts and novelty-seekers that are increasing by the day.

Flowers Foods (FLO - Free Report) is another stock I like because its baked goods have taken the lead in things like non-GMO, gluten-free, HFCS-free and other categories. The company has a strategy of building specific brands that cater to specific needs.

Another stock that has the mission of changing people’s lifestyles by helping them incorporate healthy habits is Medifast (MED). The company has a unique sales model, where the sales force is recruited as “health coaches” to sell its products and programs.

Gold is a safe haven

Exposure to gold helps to hedge against market risk. Because when investors fear a market crash, they tend to park their money in gold, driving up metal prices. But when prices drop, consumers take to the market to buy jewelry. Additionally, the last couple of decades have seen some countries buying more gold, which has also been positive for prices. Since we are currently looking at market volatility for a number of reasons, investing a little money in the commodity or in certain stocks or ETFs might be a good idea.

Stocks: AngloGold Ashanti Limited (AU - Free Report) or Barrick Gold Corporation (GOLD - Free Report) could be worth adding right now. The ETFs look expensive.