VanEck launches healthcare ETF
VanEck has announced the launch of the Global Healthcare Leaders (HLTH) exchange traded fund (ETF) which will provide exposure to global healthcare companies, featuring firms such as Gilead Sciences and Novo Nordisk.
The fund, which was at final stages of approval and would list on the Australian Securities Exchange (ASX) in coming weeks, would invest in 50 companies with the best growth prospects in the global healthcare sector, tracking the MarketGrader Developed Markets (ex-Australia) Health Care Index, which aimed to invest in stocks that deliver growth at a reasonable price (GARP) and generate long-term shareholder value.
HLTH's holdings would also include several companies which are leaders in their fields such pharmaceutical manufacturers Lilly, Bristol-Myers Squibb, ResMed and Gilead Science, which had developed the only US-approved COVID-19 treatment, the firm said.
“Globally, only the technology sector has performed better since 2008. Healthcare has been, at the same time, more defensive than technology and the overall share market by virtue of the relative performance in a down market. There is strong merit surrounding a strategic allocation to global healthcare in an investor's portfolio,” Arian Neiron, VanEck's Managing Director and Head of Asia Pacific, said.
“This has important consequences for healthcare spending. As people age, healthcare spending rises significantly. With the COVID-19 pandemic too boosting healthcare demand dramatically, businesses in the sector will likely reap the benefits of ongoing strong demand for healthcare services and products.
"Existing healthcare investment products are often 'hit or miss', as active managers bet on who they think might be tomorrow's winners based on complex factors such as drug trials and winning regulatory approvals. But a smart beta, or rules-based approach, to identifying companies that consistently deliver growth has the potential to deliver greater rewards to shareholders over the longer term.”
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