Index services have dominated investment markets for quite some time. People who prefer diversity when it comes to investing venture into thematic investing. Here is the highlight on the importance of thematic investing.
It’s an intuitive investment
This implies that instead of venturing into something unfamiliar, you can invest your hard earned money in ideas as well as trends that you are well acquainted with and those that you find exciting. Having a good knowledge of the same can provide you with the ability to make a wise investment choice. As you research on your own, it further strengthens your position. This further improves your ability to personalize your portfolio. You can invest in areas that interest you such as real estate, travel, and health.
You can align your values
Here you have the opportunity to be able to align the values that you think are important for your investment. You can simply invest in areas that you have a passion for or those that are primarily focused on social responsibility. You can just make the world a better place to live with the help of your investment.
You have a wide choice
There are companies that give you the well-prepared portfolio in advance if you wish. On the contrary, you have the option of creating a portfolio for yourself. There is a plethora of mutual fund options available to you as an investor.
Helps generate alpha
Thematic investing is the best way to get the opportunity to generate alpha. By implying that you focus your investments on the hot spots where you can distribute a significant portion of your capital, you can easily generate alpha. By simply analyzing the other portfolios, you can make a decision for yourself.
Brings you flexibility and transparency
By simply creating your own portfolios, you open the doors to great opportunities. Being able to personalize your portfolio is a great advantage in itself. All you need is great visibility as well as control in addition to transparency with no hidden cost. You get clarity from your fractional share as well as the penny.
It is easy to access
Gone are the days when only a limited number of people had access to thematic investing due to the fact that portfolio structures were not only expensive but both burdensome and complex that took a long time to maintain. Most of them were available to high net worth investors. Today, this is not the case as it has gained popularity and has become available to investors for all slices.
Overall, this is the meaning of thematic investing. If you still haven’t explored the limits of the same, now is the time for you to do the same.