Investors are accused of being ‘theme junkies’ as they chase the latest mega-trend but which theme has seen the strongest returns?
Earlier this month, chief investment officer at Montaka Global Investments, Andrew Macken, said investors were chasing trends which were being ‘spruiked’ by asset managers looking to capture the demand for thematic investments.
“It almost feels like investors are looking for a new decade-long theme… every two weeks. Investors have become theme junkies,” he said.
While investors should play out a theme over the long-term, which one had performed best over the past year?
According to FE Analytics, over one year to 31 August, 2021, there was a clear win for those funds which were focused on financials.
The top performer was VanEck Australian Banks ETF which returned 52.9% followed by BetaShares Australian Financials ETF which returned 44.9%.
This was followed by SSgA SPDR S&P/ASX 200 Financials ex A-REITs and BetaShares Global Banks ETF Currency Hedged which returned 44.7% and 44% respectively.
These four funds compared to returns of 30.3% by the specialist sector over the same period within the Australian Core Strategies universe.
Performance of financial funds versus sector over one year to 31 August 2021
At the other end of spectrum, the lowest one-year returns had come from healthcare and biotech vehicles.
CFS Wholesale Global Health & Biotechnology fund returned 19.6%, ETFS S&P Biotech ETF returned 20.1%, BetaShares Global Healthcare ETF Currency Hedged returned 22.6% and Zurich Investments ACI Healthcare Impact returned 25.8%.
Performance of healthcare funds versus sector over one year to 31 August 2021
