“You combine ownership of pets with the way people take care of their pets these days–they will do everything, such as buy dog food that’s as good as the quality of food they eat to state-of-the-art healthcare,” said Cohen.
Fund Uses Selective Screener
In terms of the strategy focus of the fund, PAWZ will provide investors with the opportunity to gain broad exposure to public companies in the global pet care industry. These include companies that stand to potentially benefit from the proliferation of pet ownership, and the aforementioned trends that substantiate the lengths pet owners go to in order to take care of their animal companions.
PAWZ accomplishes this by locating opportunities with companies that offer broad-ranging products and services. Furthermore, this includes subindustries that support pet owners and the evolving ways in which they provide for their pets.
“We’re identifying companies that are extremely involved in the pet care industry and stand to benefit from people’s passion for their pets,” said Cohen.
Screening for these particular opportunities will take place through the filter of the FactSet Pet Care Index, which is comprised of 24 companies that provide exposure to potential growth within the pet care industry.
Eligibility for the index means meeting certain criteria:
- The company’s principal revenue source is from one of eight FactSet Revere Business Industry Classification subindustries—“RBICS subindustries” for short; or
- The company generates at least $1 billion in annual revenue from at least one of the eight RBICS subindustries; or
- The company’s principal business is identified by FactSet as being pet care related, but for which an appropriate RBICS subindustry has not yet been created (e.g., pet insurance).
Furthermore, the index will tap into eight FactSet pet care subindustries, including pet food manufacturing, veterinary services, veterinary pharmaceuticals, pet supplies manufacturing, internet pet/supply retail, veterinary product distributors, pet supply stores, and veterinary diagnostics.
Economic Resilience
As long as animals and humans can coexist, PAWZ’ resilience should stand the test of time regardless of the economic landscape.
“That industry has twice the percentage growth of GDP since 2007,” said Cohen. “It’s not just a U.S. trend; it’s a global trend.
Related: PGIM Investments Adds Active High Yield Bond ETF ‘PHYL’
For more market trends, visit ETF Trends.