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New healthcare innovation ETF from HAN-GINS aims beyond the FAANGs

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Following on from last October’s launch of the HAN-GINS Innovative Technologies UCITS ETF and HAN-GINS Cloud Technology UCITS ETF, through the HANetfs’ platform, GinsGlobal’s managing director, Anthony Ginsberg, announces that they have launched the Healthcare Innovation ETF with the ticker WELL, a UCITS compliant ETF domiciled in Ireland.

WELL tracks the Indxx Advanced Life Sciences & Smart Healthcare Thematic Index (Net Total Return), an index designed to measure the performance of performance of large, mid and small-capitalisation companies primarily listed on an exchange in Developed and Emerging Markets that are involved in the Advanced Life Sciences & Smart Healthcare sector.

The ETF has a similar methodology to the first two ETFs from HAN-GINS, with a broad spectrum index. “It’s not just US companies but a global mandate,” Ginsberg says. “We are aiming beyond big pharma, looking at gene editing, robotic surgeries, medical devices, neuro sciences and also the biotech space. It’s well diversified with almost 90 holdings.”

Ginsberg says that the ETF will suit anyone who wants to expose themselves to technology innovations. “There is a lot going on in driving down the cost of health care which is a massive challenge around the world,” he says.

More and more healthcare services are adopting automated processes in diagnostics and the statistics reveal that they work better in most cases, with recovery rates from robotic surgeries in the US coming out two to three times faster, due to a less invasive approach.

“The crossover between health care and technology is tough to access, particularly beyond the FAANGs,” Ginsberg says. “Amazon and Apple will be transforming health care in the future and Apple has said it will be more aggressive in the health care space going forward.”

Ginsberg observes that there has been a lot of M&A activity in the technology space, with Google making its biggest acquisition last week, buying Looker for USD3 billion, and IBM buying Red Hat a little before that.

Microsoft has also reinvented itself and done two big alliances with Sony’s PlayStation and Oracle. “We feel the FAANGs are under regulatory threat with the GDPR law coming in in California and anti-trust regulatory investigations on the cards. Some of these FAANGs are quite fully priced now and we have seen some bumps in the returns on the back of a lot of corporate activity.”

He says that there are a lot of gems that aren’t so fully priced, particularly in the mid-cap sector. “But the whole ecosystem is benefiting from growth and corporate activity so we focus on the underlying infrastructure companies that support them.”

In terms of investors, the new ETFs have attracted some interest from sizeable firms as well as the IFA and wealth manager market in the UK, Italy and Germany.
 
Returns have been strong, from Christmas Day for four months, the first two ETFs were up between 25 and 30 per cent. They experienced a little retreat in May but recovered again and are now up between 16 and 20 per cent.

“It’s a volatile sector and people can get turned off the technology sector but there is lots more going on underneath. It may not be as sexy as the Facebooks and Googles but think more broadly on what is helping to drive the sector,” Ginsberg urges. “Go after more than the FAANGs.”

 
 

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