BITCOIN INVESTING
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iSHARES THEMATIC ETFs
THEMATIC INVESTING
Thematic investing focuses on forward-looking themes, including technological advancements like robotics and semiconductors, as well as consumer-driven trends such as electric vehicles and home builders. iShares provides ETFs, along with timely insights and portfolio analysis tools, to help advisors gain exposure to themes that are top of mind for their clients.
INVESTING THEMATICALLY
Thematic, sub-sector, country, & real asset ETFs offer precise exposures to capture the impact of mega forces. BlackRock offers the widest range of ETFs to help investors position their portfolios for these seismic shifts – from custom thematic exposures to those built around traditional market classifications.
Thematic ETFs
Purpose-built to capture themes from bottom-up, often using a sector & geography-agnostic approach.
Sub-sector ETFs
Focus on a specific subset of companies within an industry. Allowing investors to make targeted bets on particular themes.
Region & Country ETFs
Target growth in specific geographies, driven by themes like geopolitics & demographics.
Real Asset ETFs
Access tangible assets that have intrinsic value. Including exposure to commodities, real estate, infrastructure, & natural resources.
INTRODUCING MEGA FORCES
WHAT ARE MEGA FORCES?
Mega forces are key areas of change that financial professionals must focus on in the coming years. Mega forces allow your clients to invest in trends that are expected to have a profound impact on the future of our global economy.
Video 01:42
Our 2024 Mid-Year thematic update focuses on two mega forces that are reaching critical inflection points -- the transformative advancements in artificial intelligence and the growing importance of geopolitics.
These mega forces are reshaping the global economy and, as a consequence, are impacting virtually all investors’ portfolios. So how should investors approach these mega forces for the rest of 2024 and beyond?
First, we believe the opportunity today in AI lies less in the digital world and more in the physical infrastructure supporting this technology. Artificial intelligence has transcended buzzword status and is getting rapidly integrated in businesses across the economy, from healthcare to financials and more. Yet as AI adoption takes off, its emergence is creating tremendous and immediate demand for hardware, for digital infrastructure and for power. Semiconductors, data centers, and even raw materials like copper are becoming the picks and shovels critical to AI’s growth with data centers alone requiring as much as $1 trillion of investment by 20301.
Second, geopolitics is reshaping supply chains and public policy, creating select opportunities. Bipartisan efforts in the US to support domestic production and critical industries like semiconductors and automobiles, are poised to drive a renaissance in U.S. manufacturing.
At the same time, select emerging markets like Mexico and India are even benefiting from growing trade and attractive labor pools. And finally, global competition in technology and AI highlights both the vulnerabilities and opportunities of the S&P 500’s largest sector2.
To learn more about these powerful mega forces and how to potentially capture these opportunities in your portfolio, please visit iShares.com/Insights.
Sources:
1: McKinsey & Company, “The semiconductor decade: A trillion-dollar industry,” 4/1/22. Forward looking estimates may not come to pass.
2: Sourced from Morningstar as of 6/12/24. The Information Technology sector holds the largest weight in the S&P 500 TR Index, accounting for 31% of the total.
Disclosures:
Carefully consider the Funds’ investment objectives, risk factors, and charges and expenses before investing. This and other information can be found in the Funds’ prospectuses or, if available, the summary prospectuses which may be obtained by visiting www.iShares.com or www.blackrock.com. Read the prospectus carefully before investing.
Investing involves risk, including possible loss of principal.
Funds that concentrate investments in specific industries. sectors, markets or asset classes may underperform or be more volatile that other industries, sectors, markets or asset classes and the general securities market.
Technology companies may be subject to sever competition and product obsolescence.
International investing involves risk, including risk related to foreign currency, limited liquidity, less government regulation and the possibility of substantial volatility due to adverse political, economic or other developments. These risk often are heightened for investments in emerging/developing markets and in concentrations of single countries.
This information should not be relied upon as research, investment advice, or a recommendation regarding any products, strategies, or any security in particular. This material is strictly for illustrative, educational, or informational purposes and is subject to change.
Prepared by BlackRock investments. LLC, member FINRA.
© 2024 BlackRock, Inc. or its affiliates. All Rights Reserved. BLACKROCK and iSHARES are trademarks of BlackRock, Inc. or its affiliates. All other trademarks are those of their respective owners.
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LEARN ABOUT INVESTMENT THEMES MAKING HEADLINES TODAY
81% of global ETF investors plan on increasing exposure to thematic ETFs.⁴ Explore how iShares can help your clients potentially capture the trend.
Artificial Intelligence
Exposure to companies at the forefront of robotics and artificial intelligence innovation.
Semiconductors
Exposure to U.S. companies that design, manufacture, and distribute semiconductors.
Emerging markets ex China
Exposure to emerging markets while maintaining flexibility for a tailored approach to invest in China.
ARE YOU POSITIONING YOUR PORTFOLIO FOR THE FUTURE?
Picking single stocks is hard. Broad indexes can water down your theme convictions. Mega forces may allow you to target high-conviction trends without going too broad, in an ever-evolving innovation landscape.
Innovation has outpaced most large cap companies
Only 10% of the S&P 500’s largest companies have remained in the top 20 over the last two decades.1
Themes now span across multiple sectors
As examples, clean energy and EV supply chains involve companies across 6 different sectors.2 A single sector may no longer fully capture the complete value chain of a theme.
Innovation is happening beyond the US
In the last two decades, the U.S. contributed 23% to global R&D growth; while South & Southeast Asia contributed 46%.3
EXPLORE THEMATIC ETFs ALIGNED WITH MEGA FORCES
Artificial intelligence can automate laborious tasks, analyze huge sets of data and help generate fresh ideas. Digital disruption goes beyond AI.
Aging populations in major economies are poised to limit how much countries can produce and grow. By contrast, selected emerging market economies can benefit from younger populations and growing middle classes.
The transition to a low-carbon economy is set to spur a massive reallocation of capital as energy systems are rewired.
In a marked departure from the post-Cold War period of increasing globalization, we see countries favoring national security and resilience over economic efficiency.
A fast-evolving financial architecture is changing how households and companies use cash, borrow, transact and seek returns.
ACCESS MEGA FORCES IN A MULTI-THEMATIC TICKER WITH iSHARES EXPONENTIAL TECHNOLOGIES ETF (XT)
Through a single trade, XT provides exposure to nine pivotal themes driven by technological advancements, shifting demographics, changing consumer preferences, and evolving demand for finite resources.
01.
Innovation Leaders
Access global companies with significant exposure to exponential technologies, which displace older technologies, create new markets, and have the potential to create significantly positive economic benefits.
02.
Focus on Technology Producers & Users
The fund’s index employs a unique process that evaluates global stocks of technology producers and users across nine technology themes.
03.
Spans Global Sectors
Look to capture potential growth from firms driving technological advances across all areas of the economy.
EXPLORE LATEST THEMATIC INSIGHTS
1 Source: Bloomberg, 12/31/2022. 20 largest companies in the S&P 500 Index as of 12/31/2002: Microsoft, General Electric, ExxonMobil, Wal-Mart Stores, Pfizer, Citigroup, Johnson & Johnson, American Intl Group, IBM, Merck, Procter & Gamble, Coca-Cola, Verizon Communications, Bank of America, Intel, Cisco Sys, SBC Communications, Altria Group Inc, Wells Fargo, & PepsiCo. Top 20 largest companies in the S&P 500 Index as of 12/31/2022: Apple Inc, Microsoft Corp, Amazon.com Inc, Berkshire Hathaway Inc Class B, Alphabet Inc Class A, UnitedHealth Group Inc, Alphabet Inc Class C, Johnson & Johnson, Exxon Mobil Corp, JPMorgan Chase & Co, NVIDIA Corp, Procter & Gamble Co, Visa Inc Class A, Tesla Inc, The Home Depot Inc, Chevron Corp, Mastercard Inc Class A, Eli Lilly and Co, & Pfizer Inc.
2 Source: Morningstar, 12/31/22; Supply chains for clean energy & electric vehicles were measured via the S&P Global Clean Energy Index and the NYSE® FactSet Global Autonomous Driving and Electric Vehicle Index respectively, which combined span the following six sectors: Energy, Materials, Industrials, Consumer Discretionary, Info Tech., & Utilities.
3 Source: NCSES, National Patterns of R&D Resources; OECD, MSTI March 2021. Southeast Asia & South Asia, including China, Japan, Malaysia, Singapore, South Korea, Taiwan, & India.
4 Source: 2023 Brown Brothers Harriman ETF report, based on a survey of 325 ETF institutional investors, financial advisors, and fund managers from the U.S., Europe (including the U.K.) and Greater China.
Investing involves risk, including possible loss of principal.
Carefully consider the Funds' investment objectives, risk factors, and charges and expenses before investing. This and other information can be found in the Funds' prospectuses or, if available, the summary prospectuses which may be obtained visiting the iShares ETF and BlackRock Mutual Fund prospectus pages. Read the prospectus carefully before investing.
International investing involves risks, including risks related to foreign currency, limited liquidity, less government regulation and the possibility of substantial volatility due to adverse political, economic or other developments. These risks often are heightened for investments in emerging/ developing markets or in concentrations of single countries.
Funds that concentrate investments in specific industries, sectors, markets or asset classes may underperform or be more volatile than other industries, sectors, markets or asset classes and than the general securities market.
Technology companies may be subject to severe competition and product obsolescence.
This material represents an assessment of the market environment as of the date indicated; is subject to change; and is not intended to be a forecast of future events or a guarantee of future results. This information should not be relied upon by the reader as research or investment advice regarding the funds or any issuer or security in particular.
The strategies discussed are strictly for illustrative and educational purposes and are not a recommendation, offer or solicitation to buy or sell any securities or to adopt any investment strategy. There is no guarantee that any strategies discussed will be effective.
The information presented does not take into consideration commissions, tax implications, or other transactions costs, which may significantly affect the economic consequences of a given strategy or investment decision.
This material contains general information only and does not take into account an individual's financial circumstances. This information should not be relied upon as a primary basis for an investment decision.
The information provided is not intended to be tax advice. Investors should be urged to consult their tax professionals or financial advisors for more information regarding their specific tax situations.
The Funds are distributed by BlackRock Investments, LLC (together with its affiliates, “BlackRock”).
The iShares Funds are not sponsored, endorsed, issued, sold or promoted by Bloomberg Finance L.P., BlackRock Index Services, LLC, Cohen & Steers Capital Management, Inc., European Public Real Estate Association (“EPRA® ”), FTSE International Limited (“FTSE”), ICE Data Services, LLC, India Index Services & Products Limited, JPMorgan Chase & Co., Japan Exchange Group, MSCI Inc., Markit Indices Limited, Morningstar, Inc., The NASDAQ OMX Group, Inc., National Association of Real Estate Investment Trusts (“NAREIT”), New York Stock Exchange, Inc., Russell or S&P Dow Jones Indices LLC. None of these companies make any representation regarding the advisability of investing in the Funds. With the exception of BlackRock Index Services, LLC, who is an affiliate, BlackRock Investments, LLC is not affiliated with the companies listed above.
Neither FTSE nor NAREIT makes any warranty regarding the FTSE NAREIT Equity REITS Index, FTSE NAREIT All Residential Capped Index or FTSE NAREIT All Mortgage Capped Index; all rights vest in NAREIT. Neither FTSE nor NAREIT makes any warranty regarding the FTSE EPRA/NAREIT Developed Real Estate ex-U.S. Index or FTSE EPRA/NAREIT Global REIT Index; all rights vest in FTSE, NAREIT and EPRA.“FTSE®” is a trademark of London Stock Exchange Group companies and is used by FTSE under license.
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