Which thematic funds have proven most popular?
Ten years ago thematic funds represented just 0.1% of all global equity fund assets. It’s now 1%.
5th March 2020 10:30
by Tom Bailey from interactive investor
Ten years ago thematic funds represented just 0.1% of all global equity fund assets. It’s now 1%.
Investors appear to increasingly be warming to thematic funds, with the collective amount invested in such funds tripling over the past three years.
According to new data from Morningstar, as of 31 December 2019, a total of $195 billion was invested in thematic funds worldwide, up from $75 billion three years ago.
Ten years ago thematic funds represented just 0.1% of all global equity fund assets. That has now grown to 1%.
The most popular theme globally has been robotics and automation. Funds focused on the robotics and automation trend had collective assets under management of $27 billion at the end of 2019.
- Invest with ii: Top Investment Funds | Index Tracker Funds | FTSE Tracker Funds
Within Europe, resource management – primarily funds focused on water management – have been the most popular, with combined total assets of $21 billion. Also popular globally is the “connectivity” theme, which includes funds that track the theme of smart cities and the internet of things.
However, the report highlights that the growth of thematic funds has been uneven across the globe. The fastest growth has come from Europe, making it the largest market for thematic funds.
Thematic funds domiciled on the continent accounted for just 2% of all thematic funds globally in the year 2000. That has since grown to 54%, with a total of 293 funds registered in the region.
Over the same period, thematic funds domiciled in North America actually declined from 28% to 16%. European-domiciled funds now have a collective $105 billion under management.
Different regions also saw different types of thematic fund. When looked at globally, 90% of assets under management are in active funds. However, North America shows the opposite, with 80% of thematic fund asset being in passive vehicles.
Globally, there was no dominant thematic fund management company. Instead, certain companies dominated in certain regions. Pictet, for example, has the largest value of AUM. However, this comes entirely from its domination of the European market; the firm is almost entirely absent from other regions.
Full performance can be found on the company or index summary page on the interactive investor website. Simply click on the company's or index name highlighted in the article.
This article was originally published in our sister magazine Money Observer, which ceased publication in August 2020.
These articles are provided for information purposes only. Occasionally, an opinion about whether to buy or sell a specific investment may be provided by third parties. The content is not intended to be a personal recommendation to buy or sell any financial instrument or product, or to adopt any investment strategy as it is not provided based on an assessment of your investing knowledge and experience, your financial situation or your investment objectives. The value of your investments, and the income derived from them, may go down as well as up. You may not get back all the money that you invest. The investments referred to in this article may not be suitable for all investors, and if in doubt, an investor should seek advice from a qualified investment adviser.
Full performance can be found on the company or index summary page on the interactive investor website. Simply click on the company's or index name highlighted in the article.
These articles are provided for information purposes only. Occasionally, an opinion about whether to buy or sell a specific investment may be provided by third parties. The content is not intended to be a personal recommendation to buy or sell any financial instrument or product, or to adopt any investment strategy as it is not provided based on an assessment of your investing knowledge and experience, your financial situation or your investment objectives. The value of your investments, and the income derived from them, may go down as well as up. You may not get back all the money that you invest. The investments referred to in this article may not be suitable for all investors, and if in doubt, an investor should seek advice from a qualified investment adviser.
Full performance can be found on the company or index summary page on the interactive investor website. Simply click on the company's or index name highlighted in the article.