The Implications of an Ageing Australian Population
We wrote earlier this week on the impact that the Australian banks will have on the Value Australia strategy. Our focus this week is on the Ageing Australia strategy, a collection of companies that will benefit as the population ages. The performance has been fantastic, up slightly more than 16% as of the time of writing. But again the caution here today is the level of exposure to a certain industry – healthcare.
The Ageing Australia strategy has 70% exposure to healthcare stocks – CSL, Ramsey, ResMed and Sonic Healthcare are the largest. We feel comfortable with these stocks for the time being and think they might even benefit even more if that Australian banks start to trend lower. Investors will be looking for certainty in the market, the same level of certainty that the banks had apparently provided (though Invast didn’t buy into this notion).
All of the above companies should do well regardless of what happens to the domestic banking space. CSL and ResMed in particularly will continue to benefit from a falling Australian dollar. One of the important things to emerge from the current stock market malaise in Australia is the need to diversify our economic outside of mining and banking. Real estate is the obvious beneficiary but that too is limited given our population and GDP size already.
Healthcare is fast becoming an important competitive advantage and an area of focus for the diversification of Australian intellectual property. This strategy should continue to perform well over the long term, we wish to see the ASX becoming a hub for quality healthcare companies as opposed to mining which has traditionally dominated the listing profile over the past few decades. With commodity prices in the long term downward trends, this could actually becoming a strong possibility. A very interesting shift in the Australian economy.
To find our more above Invast’s PortfolioSelect platform – and strategies likeAgeing Australia– click here.
Invast Investment Committee
These are our initial impressions only, please make sure you always read all disclaimers on this website and individual reports very carefully. The Invast team of advisors are happy to answer any questions you may have, so give us a call today on 1800 468 278 or email firstname.lastname@example.org. Alternatively, use our live chat facility on invast.com.au.
*Past performance is not indicative of future performance. The calculation of the returns is based on the performance of the actual underlying securities, in accordance with the weighting envisaged by the portfolio. These performances exclude financing and commission costs.
The Invast PortfolioSelect platform offers a collection of Strategic Investment Portfolios (SIPs). SIPs are professionally researched and constructed portfolios of CFDs over underlying stocks and ETFs, which reflect popular market themes or strategies. You can buy SIPs across local and international stock exchanges in one click.
Value and low volatility stocks exploit two strategies that typically deliver more attractive risk-adjusted returns compared to the market. This portfolio will be executed as a CFD.
Australia’s ageing population will benefit many companies from a range of sectors as their business grows in line with increased numbers of older customers. This portfolio will be executed as a CFD.