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Thematic and Secular Trend Investing: Sep 2021

Thematic and Secular Trends Investing Update

Along with ESG investing, thematic investing has been one of the big beneficiaries of investor cash in recent years. According to leading independent research house ETFGI, assets invested in Thematic ETFs and ETPs listed globally more than doubled to US$414 billion at the end of May 2021 from the end of 2019. These trends are resulting in providers developing ‘crossover’ solutions to cater to both sets of investors; thematic products that also incorporate ESG tilts, and ESG focused strategies which also attempt to tap into specific trends or themes.

Amid this selection of papers are several which investigate some long-established themes, such as technology and renewables. They include the intersection between technology and healthcare noting the complexity of novel treatments and the challenge of rapidly ageing populations in developed countries. Lazard's paper looks at the prospects for several consumer sectors including gaming and streaming services, advertising, and air travel, where the adoption of digital technologies during the pandemic has significant implications for the prospects across these and other industries.

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Life Reset: Prospects for the post Covid-19 consumer economy (Lazard AM, 2021)

Lazard consumer analysts outline the ways in which the pandemic has digitised consumption, allowing e-commerce disruptors in, and accelerating the adoption of new technological advances.

Investment Ideas for the Next 12 Months (T. Rowe Price, 2021)

For compliance reasons, this paper is only accessible in certain geographies

T. Rowe Price examines several investment topics they think investors should consider, including some longer-term secular themes, such as China, business disruption and geopolitical tension.

Five long-term drivers that face investors (Franklin Templeton, Aug 2021)

For compliance reasons, this paper is only accessible in the EMEA region

Franklin Templeton strategists outline five long-term drivers that face investors, and which are likely to influence the foundation for asset prices and aspects of investment portfolios for years.

Quarterly Thematic Review: H1 and Q2 2021 (WisdomTree Investments, Aug 2021)

For compliance reasons, this paper is only accessible in the UK & Europe

WisdomTree Investments reviews the H1 of 2021 in terms of the performance and investment flows of thematic strategies. They also look at new thematic fund launches and reflect on the increasing importance of sustainable investing themes.

A Factor Analysis of Technology-oriented Thematic Indices (Qontigo, 2021)

Qontigo investigates the technology sector as a popular destination for investment flows in recent times. They note that Market and Industry factors were the key factor contributors in the sector’s positive returns.

The Evolution of Thematic Investing and ESG (Candriam, Sep 2021)

For compliance reasons, this paper is only accessible in the UK & Europe

In this paper from Candriam, they outline the strong growth evident in thematic investing focusing on structural trends, as investors try to access areas of growth in the post-pandemic era.

Quantum Leap (Aviva Investors, 2021)

For compliance reasons, this paper is only accessible in certain geographies

Aviva’s paper investigates and outlines the potential impact that quantum computing may have on several sectors but focuses specifically on finance and cybersecurity. The ramifications could be significant, but investors may need patience and a sense of realism.

The Healthcare (R)evolution (Absolute Return Partners, 2021)

This paper looks at the growth in investment in healthcare, which is driven partly by demographics and partly by the cost of new but innovative therapies. Absolute Return Partners question whether society can afford the inexorable rise in the cost of treatment and the burden it places upon those of working age.

Megatrends in Healthcare (Roland Berger, 2021)

Megatrends in healthcare are assessed by Roland Berger in this comprehensive paper, outlining the significant increase in the number of long-term care workers that will be required by an ageing population in the developed world. They highlight the potential role that technology must play in care giving, in what is likely to become a more tailored, person-centric healthcare relationship.

Renewable Energy Investment Tracker: Review of H1 (BloombergNEF, 2021)

This BloombergNEF paper tracks the investment flows into renewable energy in H1 2021, which they estimate to be in the order of $174 billion. China, Europe, and the U.S. saw most of those flows, with investment into solar power projects up 9% year-on-year.

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