Roundtable: Thematic indices: Translating megatrends into index methodologies

Thematic investing is a constantly evolving space and with data and index construction methods improving all the time, what are the main considerations when constructing a thematic index?

Theo Andrew

ETF-JSouteyrat-HD-16373 (1)

Thematic ETF launches have slowed over the past 12 months as rising interest rates and high inflation slackened demand for segments of the market with higher volatility.

However, many ETF issuers are betting thematics will be back in vogue once we pass peak interest rates with investors willing to take more risk in growth stocks.

While artificial intelligence has been the runaway theme of the year, there are several other themes in the pipeline that our roundtable of experts believe could serve investors well in the future.

The challenge for index providers and issuers alike is to develop indices and ETFs that accurately capture emerging megatrends, working with investors and each other to compile rules that stand the test of time in an ever-evolving landscape.

As a result, the roundtable, in partnership with ICE, assessed the current demand for thematic products, how to identify a theme and how to construct a sophisticated index that balances liquidity, purity and sustainable investing considerations.

  • Laura Somerville, senior director, index solutions, ICE

  • Vincent Denoiseux, Head of ETF Investment Strategy, Amundi

  • Dwijen Gandhi, senior director, head of equity index research and development, ICE

  • Rafaelle Lennox, head of UCITS ETF product strategy, Franklin Templeton

  • Michael Stewart, head of pooled index strategy, Legal and General Investment Management

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.

Featured in this article

Logo for ICE Data Services


No ETFs to show.