Want to know about megatrend investing?
Megatrends are powerful structural forces of change that carry significant investment implications.
Written by
Laurent Ramsey
Managing Partner
Megatrends are not concepts that should be confined to academic journals – they are powerful structural forces of change that carry significant investment implications.
It was back in the 1990s when Pictet Asset Management first recognised the importance of these pervasive secular trends and how they could be harnessed by investing along thematic lines. When we launched the Pictet Biotech strategy in 1995, it was one of the first funds to invest exclusively in biotech stocks. This was followed five years later by the launch of the Pictet Water strategy, which was one of very first environmental thematic strategies few funds of its kind.
At that time, such strategies were viewed as niche investments, suitable for a narrow band of investors. Today, the thematic approach has been embraced by numerous institutional investors worldwide. The evolution of these strategies into mainstream investments is testament to their enduring long-term performance.
But thematic investing is also a strategy for the future. Since the beginning of the global financial crisis, the rise in the correlation between regional equity markets has diminished the benefits of cross-regional diversification. By adopting a global, thematic approach that both ignores the constraints of benchmarks and seeks to capitalise on the secular trends shaping our world, investors can diversify the sources of risk and return within their portfolios.
In an investment environment that promises to be unpredictable, this is something investors should value.
It was back in the 1990s when Pictet Asset Management first recognised the importance of these pervasive secular trends and how they could be harnessed by investing along thematic lines. When we launched the Pictet Biotech strategy in 1995, it was one of the first funds to invest exclusively in biotech stocks. This was followed five years later by the launch of the Pictet Water strategy, which was one of very first environmental thematic strategies few funds of its kind.
At that time, such strategies were viewed as niche investments, suitable for a narrow band of investors. Today, the thematic approach has been embraced by numerous institutional investors worldwide. The evolution of these strategies into mainstream investments is testament to their enduring long-term performance.
But thematic investing is also a strategy for the future. Since the beginning of the global financial crisis, the rise in the correlation between regional equity markets has diminished the benefits of cross-regional diversification. By adopting a global, thematic approach that both ignores the constraints of benchmarks and seeks to capitalise on the secular trends shaping our world, investors can diversify the sources of risk and return within their portfolios.
In an investment environment that promises to be unpredictable, this is something investors should value.
read more
Understanding megatrends
The analysis from our research partner CIFS sheds light on the structural trends transforming the world, helping us build better investment portfolios.
June 2021
Back to the future
How Pictet Asset Management pioneered the thematic approach to equity investing.
January 2021
Our thematic DNA
We've built our thematic strategies on three investment pillars.
January 2021
Thematic Advisory Boards: experts that give our investment managers an edge
Investment managers of our thematic equity strategies always focus on the long-term. Our Thematic Advisory Boards help them maintain that perspective.
January 2021
How megatrends power thematic equities
Thematic equity strategies invest in companies whose prospects are underpinned by powerful forces of change we know as megatrends.
February 2020
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