Thematic Investing Series 2: Selecting thematic funds

Presented by

Pierre Debru, Director, Research, WisdomTree

About this talk

Fund selection in thematic investment is key because of the vast difference between funds in the same investment theme, whilst being challenging because of the absence of benchmarks, peer groups, and track records. In this webinar, we look to mitigate this issue by proposing that investors focus on strategy construction and their own beliefs about a given theme. Our goal is to provide clear steps for understanding which strategy might best represent an investor’s conviction in a theme and its underlying story. To do so, we present a holistic framework for selecting thematic funds based on these five building blocks. 1. Clarity of Theme, 2. Expertise, 3. Purity of exposure, 4. Differentiation, 5. Portfolio Construction. Thematic investments promise to harness long-term growth by turning structural, world-changing shifts into compelling investment opportunities. While rife with potential, these new investment strategies also create risks for investors as they force us to rethink how we evaluate these tools in the context of fund selection and asset allocation. Across this series, we will look at the investment process in its entirety and propose adjustments that would allow investors to harness the power of megatrends through thematic investments. Other webinars in this series: • Understanding the Thematic Universe - The WisdomTree Thematic Classification • Strategic or tactical thematic portfolios - How to combine the different themes? • Three approaches to fit thematic investments in a portfolio

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