Why investing in healthcare  and technology is a good idea

Published July 19, 2021, 12:12 AM

by Ignacio R. Bunye

Speaking Out

Ignacio R. Bunye
Ignacio R. Bunye

The healthcare and technology sectors are leading the world’s fight against the COVID-19 pandemic. Innovations have enabled both sectors to create competitive advantages as the world adapts to the new normal. This may be the reason why global healthcare and technology stocks have become attractive to investors these days.

Even before the pandemic, the demand for healthcare has been increasing steadily. According to World Health Organization’s 2020 report, there has been stable and continuous growth in global spending on health from 2000 to 2018. In 2018, health spending reached US$8.3 trillion or 10 percent of the global GDP.

One of the key messages of the report says that “the COVID-19 pandemic caught the world by surprise, but confirmed the need for greater and more secure public funding for health.” While the impact and lingering effects of the pandemic remain uncertain, this event only highlighted how countries, regardless of their income level, were unprepared to face the crisis.

The pandemic has certainly placed high demands on healthcare systems around the world, but the industry has responded to this challenge with resilience and innovation. In fact, various health organizations and health experts are working together, doing their best to strengthen the sector’s capabilities and facilitating knowledge sharing to quell this pandemic.

Advancements in digital technology have also helped alleviate the impact of the pandemic in our daily lives. Technology continues to play an integral role in the recovery and growth of the economy, and more businesses have started to see digitalization as a key factor to thrive in the new normal.

Even the World Bank has seen the world’s increased reliance on digital technology, saying “digital platforms help build more resilient societies as people can now access official information, enrol in e-courses, take online jobs, send mobile money and even receive telemedicine—no matter where they live.”

Given the importance of these two sectors, the BPI Asset Management and Trust Corporation (BPI AMTC) recently launched two new Unit Investment Trust Funds that offer Filipino investors access to the world’s most innovative companies in healthcare and technology.

Investing in health

The BPI Invest Global Health Care Feeder Fund invests at least 90 percent of its assets in a target fund, the Wellington Global Health Care Equity Fund. Filipino investors can now ride the growth story of the world’s largest healthcare companies that are at the forefront of battling COVID-19 and are trailblazers in the medical space.

Among the companies in the portfolio of the BPI Invest Global Health Care Feeder Fund as of May 2021 are Pfizer Inc. and AstraZeneca PLC, two major producers of COVID-19 vaccines and other widely-used pharmaceuticals.

“Vaccine development led by the healthcare sector brings optimism for an economic restart. Beyond these pandemic initiatives, the health care sector is also poised for growth due to its continuous innovation to address unmet medical needs and increasing demand both from an aging population and a global need for cutting-edge products and services,” said Smith L. Chua, Chief Investment Officer of BPI AMTC.

The fund portfolio also features global manufacturers of medical devices such as Boston Scientific, and renowned healthcare companies such as UnitedHealth Group.

Investing in technology

Meanwhile, the BPI Invest World Technology Feeder Fund is BPI AMTC’s first technology-focused fund that invests in today’s leaders and tomorrow’s winners in the technology space. Its May 2021 portfolio includes household tech names such as Apple, Microsoft, Google, Kakao, Amazon, Tesla, and PayPal.

BPI Invest World Technology Feeder Fund allocates at least 90 percent of its assets in BlackRock’s World Technology Fund. By subscribing to this BPI Invest fund, Filipino investors can gain access to a sector known for innovation and disruption, presenting rich opportunities for active fund managers to select favorable investment outlets.

Of course you can directly invest in these healthcare and technology companies, or you may invest through pooled funds that banks or other financial institutions may offer.

Now is the best time for Filipinos to invest in funds that enable them to capitalize on growth opportunities. Fortunately, despite grim economic prognostications in the near future, there are still bright spots ripe for investment.

Support RITM

In a related development,  Dr. Anthony Fauci,  the US top infectious diseases expert has urged the Philippine government to increase support for Filipino scientists and research institutions. Fauci cited the Research Institute for Tropical Medicine which was earlier recognized as a “center of excellence” by  National Institute of Allergy and Infectious Diseases (NIAID).  Fauci expressed the hope that the Research Institute for Tropical Medicine  and similar agencies — will continue to get the assistance they  need  so that they remain competitive for both funding and talent.

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