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Investing Megatrends: An Aging World

Highlights

  • Aging is a transformative, long-term megatrend.
  • Strategies that address problems around aging may offer great growth opportunities.
  • Healthcare firms, particularly those in specialized niches, may be well positioned.

Aging, an inescapable part of life, is a big global tailwind with massive investment implications. This is especially important now because there is a major demographic theme unfolding across the globe today. The populations of both developed and emerging economies are growing older, though they’re at varying stages of doing so.

The number of people 65 and older is now increasing globally by more than 1 million per month, and within the next five to eight years, there will be more “older people” than young children in the world for the first time in history.1  As societies age, patterns of consumption shift, creating new business and investment opportunities. Products or services which may be viewed as sleepy or highly niche today may present very different long-tailed growth possibilities.

Like other megatrends, this one is not about a specific geography. Instead, industries and companies throughout the globe may draw benefit from this theme in varying degrees, and can be repositories of above-average long-term return potential. 

For investors, capturing this opportunity may best be accomplished by a broad global mindset seeking the best companies worldwide. Since not all investment opportunities are created equal, it takes a keenly trained eye to parse the lasting ones from the transient kind. An experienced, active approach that focuses on quality companies with sustainable competitive and growth characteristics may be of significant benefit.

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Read about other Investing Megatrends shaping global investing:


 
1. Source: Population Division of the Department of Economic and Social Affairs of the United Nations Secretariat, World Population Prospects: The 2012 Revision.

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