For this week’s episode of ETF 360, ETF Trends CEO Tom Lydon and CIO Dave Nadig caught up with Scott Helfstein, Executive Director of Thematic Investing at ProShares, to discuss what 2020’s rise of thematic and innovation could lead to in 2021.
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For Helfstein, he believes that innovation is a strategic imperative for companies. This translates to building and developing technology to create new business processes. Furthermore, simply characterizing it as an asset class is practically a disservice to how important it actually is across all businesses.
As he states, “Either companies are being innovative, or they’re going to be left behind. We want to find the companies that are innovative, but that oftentimes means getting into the weeds and understanding innovation in different parts of the economy and in different industries.”
ANEW Attitude
When discussing ProShares’ recent product, the ProShares MSCI Transformational Changes ETF (ANEW), Helfstein explains how, currently, a large focus is on trends that are accelerated by coping. With work attitudes and arrangements shifting thanks to working from home, it’s led to a dramatic shift that needs to be accounted for. It’s not just due to the Covid-19 pandemic either, as it really feels like a shift that was occurring already, only to have been accelerated by the presence of the virus.
“We’re really focused on long-term, secular trends that were accelerated by the pandemic,” Helfstein states. “Now, some of these are things that are really relatable — telehealth, working from home, cloud computing, all things that we’ve used. But, what does that mean for the future?”
As Helfstein clarifies, there is a more efficient use for things like data and healthcare, let alone more collaboration tools for people to use. There’s also the growth of the cloud, which has proven to be cheaper and more efficient.
This extends to genomics and biotechnology, as pointed out by Lydon. As Helfstein makes clear, this year will be the first time a genomic medicine will be administered on a mass scale, which again comes from accelerated work, but with a positive intention that will leave an impact and push forward the genomic revolution.
As far as how to look out for unexpected themes, Helfstein explains that he and ProShares are essentially looking into behavior change during the pandemic in four ways. For example, how people work, take care of themselves, consume, and connect. Within those areas, there are roughly 20 different themes. There are many different explorable areas as well, such as cybersecurity and digital payments when it comes to work. And still, there’s always more to look out for.
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