Thematic Trends Open Doors to Durable Return Streams
Portfolios offering investors access to the investment opportunities derived from long-term, structural growth trends in healthcare and technology innovation
In a world of market volatility and macroeconomic uncertainty, many investors crave return streams that can overcome external stresses. Thematic trends open a door to just that.
Transformative technology and healthcare innovation are changing our world in dramatic ways. Portfolios focused on companies that are exposed to these big themes, with high quality businesses, can provide access to return potential supported by long-term, structural growth trends that will help redefine the world we live in.
The Future of Healthcare
Transformative Technology
Healthcare stocks benefit from long-term thematic trends, with demand driven by aging populations in developed markets and economic growth in emerging markets. Scientific progress is opening doors to new treatments while reducing costs. And demand for healthcare tends to transcend cyclical turns in the economy.
The technological revolution in healthcare is just beginning. Robotic surgery, new diagnostics and life science tools that can identify diseases at an early stage, as well as treatments for Alzheimer's disease and cardiovascular disorders, are among many new developments driving growth in the sector. Telehealth and digitization offer dramatic potential to deliver better patient care.
Still, some investors might not feel comfortable investing in a single-sector portfolio. Healthcare, however, deserves a special place in an equity allocation. We believe a carefully curated portfolio of healthcare stocks offers a unique combination of strong return potential and risk reduction characteristics for changing market conditions.
Healthcare has long been considered one of the most reliable defensive sectors. Despite short-term bouts of turbulence we believe the dynamic products and services that now dominate the healthcare space are the reason why a portfolio of carefully selected stocks in the sector still enjoys long-term defensive characteristics.
Investment Solution
AB’s International Health Care Portfolio focuses on quality businesses across the healthcare sector, including drug development, diagnostics, robotics and services. Since investors have no insight into the probability of scientific success, we don’t focus on scientific breakthroughs. Instead, the portfolio seeks profitable healthcare companies with strong fundamentals to bolster long-term return potential.
Artificial Intelligence (AI) has reignited the imagination of investors about the power of technology to change the world. Yet technological turning points in the past have taught important lessons about how to identify long-term winners from transformative innovation.
Focusing only on the highest-profile companies that are seen as big winners from AI may be a short-sighted strategy. Instead, investors should seek to identify future leaders with truly distinctive innovation and competitive advantages that are poised to benefit from the AI disruption at our doorstep. And beyond AI, disruption is creating opportunities in diverse areas from cloud infrastructure to the energy transition to healthcare and digital transactions.
Finding disruptive companies with profitable business models that are addressing some of the world's biggest challenges can help play an important role for investors seeking thematic exposure to durable sources of long-term return potential.
Investment Solution
AB’s International Technology Portfolio seeks to invest in innovative and disruptive companies that have the potential to generate attractive financial returns. Target companies include disruptors, or business that dramatically change the status quo through innovation; and enablers, leading companies with creative solutions that drive positive changes in current demand. All portfolio candidates must offer strong durable growth potential.
The value of an investment can go down as well as up and investors may not get back the full amount they invested. Capital is at risk.
The Portfolio/Fund is meant as a vehicle for diversification and does not represent a complete investment programme. Prospective investors should read the Prospectus, which includes Sustainability-Related Disclosures, and discuss risks and the Portfolio's/Fund’s fees and charges with their financial advisor to determine if the investment is appropriate for them. The views expressed herein do not constitute research, investment advice or trade recommendations and do not necessarily represent the views of all AB portfolio-management teams and are subject to revision over time.
AB offers open-ended Luxembourg-based funds under AB FCP I, a mutual investment fund (fonds commun de placement) organized under the laws of the Grand Duchy of Luxembourg and AB SICAV I, an open-ended investment company with variable capital (société d’investissement à capital variable) incorporated under the laws of the Grand Duchy of Luxembourg.
Not all of the strategies and products we offer are available and/or registered for distribution in all jurisdictions. The sale of funds may be restricted or subject to adverse tax consequences in certain jurisdictions.
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Investors face many strategic questions in today’s challenging landscape.
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