Whether clean energy, greater cybersecurity, or more efficient infrastructure: if you see opportunities in themes like these and are already familiar with the risks of pure equity investments, a new offering from quirion might interest you.
The trend researchers at the Zukunftsinstitut call them "deep currents of change" and "avalanches in slow motion": megatrends are transformative changes that have a major impact across all areas of life, worldwide and over the long run. In the world of investing, too, trends like these keep making the headlines. "Thematic investing" is the keyword here, and there is now a wide range of corresponding investment products.
But which megatrend is especially relevant economically, and which investment theme holds promise for the future? How do you invest as efficiently as possible while giving due consideration to the risks? Questions like these are exactly what quirion's investment strategists got to the bottom of. They took a close look at megatrends and analyzed specialized thematic ETFs in depth. Such products give investors diversified yet cost-effective access to investing in individual thematic areas.
The Megatrends Portfolio from quirion
The result of this analysis is a new ETF portfolio that bundles several forward-looking investment themes and the megatrends associated with them. At launch it includes the themes of New Energies, Cybersecurity, Infrastructure, Artificial Intelligence as well as Smart Cities. These have a particularly strong connection to megatrends such as urbanization, demographic change, and globalization, but also to sustainability, individualization, and digitalization.
The selection of themes and products for the portfolio takes place in several steps. How strongly are the individual themes carried by megatrends? How much do the themes influence one another? The stronger the respective themes perform in the analyses, the more relevance they have for the Megatrends Portfolio. In the assessment of the investment strategists on quirion's investment committee, that is an important signal of their relevance and their fitness for the future.
The composition of the themes and products, as well as their weighting in the Megatrends Portfolio, is not set in stone but in flux. One important criterion for constructing the portfolio, and hence for making corresponding adjustments, is risk. The historical range of fluctuation of the individual thematic investments varies quite a bit. For better balance, the risk contribution of each theme to the overall risk of the portfolio was therefore aligned. Themes that are less prone to fluctuation are thus weighted more heavily. In addition, the investment strategists observe the inflows and outflows of money in the individual ETFs. That reveals something about how attractive the market considers the themes to be. Along these criteria, the weighting of the portfolio is adjusted regularly. What's more, the quality of the ETFs contained in the portfolio is continuously monitored, checking whether the market might offer new products that are even better suited to the investment goals.
Setting your own accents
"The new offering is an expansion of our product range. It is aimed at investors who want to set their own accents with such an investment in their quirion account," explains Philipp Dobbert, chief economist and head of investment management at quirion. "At Quirin Privatbank, we have long offered the option of giving greater weight to one's own opinion within portfolios," Dobbert explains. Now, he says, the company is creating such options in digital wealth management too.
The setup and investment strategy of the global portfolios, just like those of the sustainability portfolios, remain untouched by the new offering. "The worldwide diversification, the orientation toward market capitalization and toward relevant return factors, the refusal to make forecasts: all of this remains our firm conviction, grounded in insights from capital-market research," Dobbert notes. When it comes to the ratio of expected return to risk, he says, an investment strategy oriented toward such criteria is superior to all others and thus remains the foundation for building wealth systematically.
No one knows the future. That also applies to the development of megatrends or thematic investments, which are always based on certain expectations. "Investors need to be aware that with the Megatrends Portfolio they are pursuing a different strategic approach than with our core portfolios," Dobbert stresses. "But some people want to engage more strongly, and quite deliberately, in future themes, beyond a core investment and clearly separate from it." Thanks to the product selection and the continuous monitoring within the scope of wealth management, he says, the risk for investors is lower than with a comparable engagement in individual securities or single thematic products.
Mind your risk profile
The Megatrends Portfolio is exactly the right addition for some, but not suitable for everyone. The prerequisite: investors have the appropriate risk profile. That means they know their way around investing well, bring a willingness to take on risk, and have a long-term investment horizon. Because the portfolio consists 100 percent of equity ETFs. Since it concentrates on very specific segments of the capital market, the fluctuations can be larger than with quirion's global portfolios.
How attractive thematic investments are for quirion customers and interested parties therefore depends not only on personal conviction, but also on the risk profile.
To quirion's new Megatrends Portfolio this way.
