COVER STORY Passions
AUM in thematic funds 2017-2020 (€ BN )
Europe Asia Pacific North America
700 |
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600 |
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500 |
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400 |
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300 |
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200 |
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100 |
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0 |
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Q1 ' 17 |
Q2 ' 17 |
Q3 ' 17 |
Q4 ' 17 |
Q1 ' 18 |
Q2 ' 18 |
Q3 ' 18 |
Q4 ' 18 |
Q1 ' 19 |
Q2 ' 19 |
Q3 ' 19 |
Q4 ' 19 |
Q1 ' 20 |
Q2 ' 20 |
Q3 ' 20 |
Q4 ' 20 |
Source : Broadridge Thematics Analysis 2021 / AXA
trading ,” cautions Marcus de Maria , chief executive of Investment Mastery . “ You might get into a company too early just because you like it and enter at the wrong price . There is also the risk of holding on to stocks for too long after you should have exited . You might more easily sell the stock of a company you don ’ t care about .”
Following the crowd A more sensible option for following your dreams is to use a thematic fund or ETF , of which there are plenty of options . Thematic funds now contain around € 487bn of assets worldwide , having grown at an annual rate of 37 % since 2018 , according to data from
AXA . Not only that , but demand is accelerating , with thematic funds growing by 77 % in 2020 . Yet just because everyone else is doing something , this doesn ’ t necessarily mean it is a good idea . Alex Illingworth , manager of the Mid Wynd International Investment Trust , points to research showing that thematic ETFs trading in the US between 1993 and 2019 underperformed the stock market by around 4 % for at least five years after their launch . Other research shows that fewer than 15 % of thematic funds survive beyond 15 years .
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