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August 2019

Healthy living: a trend worth investing in

As a society we're spending more on health. For investors that presents new opportunities in the health nutrition biotech and environmental sectors.

We are living for longer, have more leisure time, and are becoming wealthier. And there are more of us inhabiting polluted cities than ever before.

It is no surprise, then, that as a society we’re spending a bigger portion of our income on health. Governments are increasing investment to deal with problems such as age-related illnesses and urban pollution while consumers are spending more on healthier food and leisure activities.

The numbers certainly bear witness to the shift in our priorities. Public spending on health in developed countries has risen by over 2 per cent per annum over the past decade.1

At the same time, sales of healthcare wearable devices are forecast to be 50 times greater in 2018 than they were in 2015,2  while the global organic food market is projected to expand by 14 per cent a year through to 2021.3

Investors should take note. As money flows into health-related industries, investment opportunities are bound to emerge.

That’s where our range of healthy living strategies comes in. Our four health-related investment strategies give investors access to some of the companies we expect to benefit from this powerful, long-term trend.

  • The Health strategy aims to identify the most attractive investments in three areas: innovation in the production of new medicines, modernisation of equipment and services and the development of more effective tools and technology. Technological innovation is key, particularly where it drives the falling costs of DNA sequencing and the expansion of computer processing power.
  • Companies in the Nutrition strategy are focused on developing solutions to help secure the world’s future food supply, be that through improving farming productivity, reducing food waste or maximising the nutritional content of what we eat.
  • Our Biotech portfolio is invested in companies – both small and big – at the forefront of medical innovation. This fast-growing industry uses biological processes, organisms or cells to develop new technologies and medicines. Breakthroughs here can be very profitable.
  • Safeguarding the environment is the key theme of the Global Environmental Opportunities (GEO) strategy. Unhealthy environments account for nearly a quarter of all deaths globally, with diseases related to air pollution taking a particularly heavy toll.4 This presents a big opportunity for companies who are developing new ways to safeguard natural resources and reduce pollution.

Health matters to all of us. From improving the quality and sustainability of the food we eat and cleaning the air we breathe to curing our illnesses, innovative companies are helping us live healthier lives. We believe such businesses will be among the most attractive long-term investments in the global equity market. Just as we cannot afford to ignore our own health, investors should not overlook the opportunities presented by the boom in healthy living.