Thematic Investing: Future Trends in Today’s Portfolio

December 22, 2021
Thematic Investing: Future Trends in Today’s Portfolio

Digital wealth management is poised for strong growth in Asia, positioned perfectly to reach the mass affluent who find themselves in need of financial advice. This segment of underserved customers is searching for cost-efficient and hyper-personalised digital wealth management solutions. And one of the investment propositions that financial institutions are offering is thematic investing. 

What is Thematic Investing? 

Thematic investing is an investment strategy that looks to benefit from the growth and maturation of structural macro trends. Thematic investing tends to be sector-independent and follows the movement and progress of a changing world. It allows an investor to access trends that affect entire industries and represent societal shifts, rather than specific companies or sectors. This allows investors to invest in ideas that align with their interests and causes, and are, ultimately, meaningful to them. 

Popular Themes

Common ideas that investors can access include environmental, social, and governance (ESG) themes, technology themes, and demographic themes. ESG themes relate to resource scarcity, alternative energy, and sustainable businesses. Meanwhile, technology themes look at the disruptive role of technology in today’s day and age to provide investors with opportunities to invest in businesses related to robotics and automation, cloud computing, and fintech. All of which have shown significant growth over the past five years. Demographic themes cover trends that have seen enormous societal shifts in recent years such as ageing populations, digital buying behaviour, and healthcare. 

Why Thematic Investments?

Thematic investments offer investors an opportunity to diversify their portfolio and improve its risk/return characteristics. This approach is appealing as some themes easily capture customer excitement and enable them to invest in ideas that they are passionate about. Thematic investing is usually done at a lower entry point, allowing for smaller investors to get in on the game. 

At Quantifeed, the technology platform and quantitative expertise powering QEngine can provide a strong experience for the investor. It empowers advisors and portfolio managers alike to provide thematic investment options to customers directly on a mobile application. Investors can then use the strength of our technology to create their ideal investing experience and derive income from their portfolio. The portfolios they invest in are then automatically monitored and rebalanced following market movements. Customers are free to invest and gain exposure to their preferred themes in a way that enhances returns while keeping risks contained. 

Quantifeed’s Thematic Investments                     

At the heart of our business, we wish to bring wealth management to the masses. We believe in making wealth management inclusive and available to anyone who wishes to create a better financial future for themselves. 

Today, investors are more discerning and expect more from their investments. Monetary returns aren’t the only thing they’re after as responsible investing begins to take centre stage. The ability to customise for the investor’s preferences beyond just their risk profile contributes to the success of a wealth management offering. As such, QEngine supports hyper personalisation, providing investors an engaging and meaningful experience as they explore, personalise, and invest in their favourite ideas. Until very recently, such features were only available to those who could afford to open an account with a private banker. Now it’s available to everyone with a mobile phone. 

Our technology and investment solutions can be deployed immediately. In fact, QEngine is already powering many of these platforms in Asia. It enables banks, insurance companies, and brokers to plug these capabilities into existing infrastructure. We can design, develop, and deploy new investment journeys quickly and easily – and turn on the future of wealth management for you.