The healthcare sector is slowly, but surely adopting blockchain technology as part of its core operations, leading to investment opportunities in the Invesco Alerian Galaxy Blockchain Users and Decentralized Commerce ETF (BLKC) and the Invesco S&P SmallCap Health Care ETF (PSCH).
According to a Market.us report, blockchain technology is set to reach $750 billion in less than 10 years. Maintaining confidentiality with regard to patient records is paramount in the healthcare industry. And the security capabilities of blockchain could help to accomplish that task. It can also assist with other back-office support tasks like billing and supply chain management.
“Patients gain control over their health data, deciding who can access it,” the report said. “The technology streamlines administrative processes like billing and supply chain management, increasing efficiency and cost reduction. Smart contracts automate and enforce agreements, particularly beneficial in tasks like insurance claims and billing, minimizing the need for intermediaries.”
Given its exponential growth trajectory, this can offer opportunities in blockchain-focused exchange-traded funds (ETFs) like BLKC. Per its baseline fund description, BKLC is based on the Alerian Galaxy Global Blockchain Equity, Trusts and ETPs Index (Index). It’s primarily comprised of stocks of companies that are materially engaged in the development of blockchain technology, cryptocurrency mining, cryptocurrency buying, or enabling technologies, and ETPs and private investment trusts traded over the counter that are linked to cryptocurrencies.
The fund’s market cap allocations offer diverse exposure to mostly small and large-cap companies. The latter comprises over 60% of the fund as of May 8. Furthermore, it diversifies its country exposure to companies outside of U.S. borders though over 70% of the fund focuses on U.S. companies.
Small-Cap Innovation
When it comes to innovation, small-cap companies can be at the forefront of emerging trends ahead of their large-cap counterparts. As such, PSCH is a prime option to get ahead of the trend before larger companies adopt innovative advancements from blockchain technology.
PSCH is based on the S&P SmallCap 600® Capped Health Care Index. It’s designed to measure the overall performance of common stocks in the healthcare sector, including companies principally engaged in the business of providing healthcare-related products, facilities, and services, including biotechnology, pharmaceuticals, medical technology, and supplies.
The fund isn’t just solely focused on companies that can offer aggressive growth prospects. Included in its small-cap focus are tailored holdings that exhibit value, growth, and a blended mix of factors.
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