Is it time to retire ageing ETFs?

The challenges of a fresher-faced fund structure entering an already mature theme

Jamie Gordon

ageing population retirement

Despite ageing being the key demographic trend and the stuff of fixation for macro analysts, the scant global line-up of ETFs addressing the theme have failed to fork much lightning since their belated arrival seven years ago.

The inverted population pyramids discussion returned to the fore last year as China announced its population fell for the first time in 60 years while those assumed to be of working age – 16 to 59 years – accounted for just over 60% of its overall population, according to China’s National Bureau of Statistics.

Worryingly, this did not owe to rising birth rates, with a 2021 survey by China’s Communist Youth League finding having one or no children has become the social norm in China as a hangover of the one-child policy.

The world’s second-largest economy is just the latest to flag such concerns over demographic change, with over 65s already making up more than 20% of the population in Japan, Germany, Italy and Greece and already outnumbering children under the age of five globally, according to World Bank data.

Set against an irrefutable macro backdrop, it is reasonable to assume investable opportunities in the theme would thrive, however, just three Europe and US-listed ETFs offer exposure and have captured only $856m assets collectively.

This article first appeared in ETF Insider, ETF Stream's monthly ETF magazine for professional investors in Europe. To read the full article, click here.

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