European investors have turned to “significantly attractive” opportunities within the healthcare space due to global demographic shifts, according to research by BNP Paribas Asset Management.
The survey, which assessed how shifting demographics in Europe, the US and Asia are impacting asset allocations, found healthcare was of substantial interest to European and Asian investors, with 95% noting its importance due to ageing populations.
The survey of institutional investors and intermediates found technology (84%), energy (67%), agrifood (63%), leisure and tourism (60%), and real estate (59%) were also of current interest to investors.
Almost all investors surveyed (95%) cited the acceleration of digital and new technologies as an important change shaping their investment strategies.
This was closely followed by the impact of ageing populations (91%), changes in consumer spending habits (89%) and population growth in emerging markets (86%).
Sandro Pierri, CEO of BNP Paribas AM ,said: “The findings show the extent to which demographic shifts and asset allocation considerations are interlinked with the ever-quickening pace of technology and the focus on sustainability, which requires a fundamental re-allocation of capital.”
The findings also suggest shifting demographics are affording European investors additional confidence.
Demographic change was identified as an investment opportunity by almost 60% of surveyed investors and as a risk by 20%, but investor preference in Asia was for less investment risk (39%), compared with increased investment risk expected in the US and Europe (both 17%).
Nearly a quarter – or 21% - of European investors noted emerging market population growth as an extremely important aspect of demographic change for investment strategies, compared to 51% of Asian investors.
Pierri continued: “This will need deep transformation in the investment industry to cater for issues such as funding the pension gap, moving from wealth creation to wealth preservation adapted to clients’ risk profiles, or providing for a more digital way of investing. While this presents challenges, it also creates new opportunities.”
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