How to Invest in Quantum Computing Companies
Quantum computing is an emerging technology that has the potential to revolutionize many industries.
According to a late 2021 Statista forecast, the quantum computing market’s total revenue is projected to reach US$8.6 billion by 2027. To put that into perspective, the industry was worth only US$412 million in 2020.
With that in mind, it’s clear the field of quantum computing is nascent and exciting. Here the Investing News Network takes a look at what quantum computing is, its potential impact on several industries and how investors can get exposure to quantum computing through stocks, startups and exchange-traded funds.
What is quantum computing?
In simple terms, quantum computing is a form of computing that harnesses the principles of quantum mechanics to process information. Unlike traditional computing, quantum computing does not use binary digits (either 0 or 1), or bits. Instead, quantum computing is based on qubits, which can represent much more information than bits can.
Qubits can be both a 0 and a 1 simultaneously, which allows quantum computers to calculate larger datasets much faster than traditional computers.
Quantum computers can also explore several possible solutions at once. This gives them a distinct advantage in solving problems related to optimization, cryptography, machine learning and financial modeling. In addition, quantum computers have promising applications in chemistry and material science. For example, quantum computing can simulate how a chemical compound might react in various scenarios.
How does quantum computing work?
Quantum computing is based on the principles of superposition and entanglement. In quantum mechanics, superposition describes the ability of a system to remain in multiple states at the same time until it is measured. Measurement in this context refers to any interaction between qubits and an external system, such as a detector or sensor, that would cause the qubits to collapse from multiple states to a single state.
To understand the concept of superposition, it’s useful to imagine a coin spinning on its edge. When a coin is spinning, it is said to be in a state of superposition, meaning it is not defined as either heads or tails. However, if the coin is bumped or disturbed in any way, it will stop spinning and will end up displaying either heads or tails. In this analogy, the coin would be the qubits and the measurement would be whatever caused the coin to stop spinning.
Qubits are sensitive to interference from their environment and are usually stored at very low temperatures in computing devices to protect them from influences such as temperature fluctuations, electromagnetic fields and other particles.
For its part, entanglement describes a deep connection between two qubits, where the state of one qubit is directly dependent on the other qubit, no matter the distance…
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