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Thematic opportunities from some amazing stats

Consider this: the first human being – probably a white woman – will live beyond her 125th birthday within the next 20 years. Imagine the implications for her pension plan.Matthew Sigel, portfolio manager in the global thematic research team at Alliance Bernstein, gave a client presentation this week as to the investment opportunities and threats which flowed from various demographic and other worldwide themes.

He told pension fund clients that, thanks to genomic medicine, that new genetic therapies would redefine how the world practiced medicine and open up vast new opportunities.

But for pension funds, and their members, this is a twin-edged sword: a lot of people will live a lot longer, but how will they pay for that longevity?

Sigel, whose presentation this week took place in Sydney, focused on the investment opportunities of five main themes in global investing:

  • The rapid growth of emerging economies, particularly in China, has given birth to a new and rapidly growing middle class.
  • The massive stimulus packages to help revive the global economy have led to a reshaped environment of cyclical opportunities.
  • New expenditures to control climate change have profound investment implications.
  • Promising new companies are learning how to exploit the global increase in broadband capacity.
  • New Genetic therapies will redefine how the world practices medicine.

Sigel predicted that internet-connected ‘smart phones’ would outnumber personal computers by two to one in the not-so-distant future.

“Disruptive transformations in these and other areas are occurring at an even faster pace—a trend that is set to continue,” he said.

“Thematic portfolios offer investors a way of harnessing the attractive opportunities that such transformations can create through a targeted focus on thematic drivers and a different perspective on stock selection.”

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