Thematic funds seek to identify, on the stock market, companies benefiting from excess growth linked to structural societal trends. Security is one of them. “It is a primary human need and a top priority for business leaders and governments,” says management company Thematics Asset Management. This investment universe may have gained nearly 11% per year over the last ten years, but it still offers high potential, driven by two drivers: regulation and innovation. One of the attractions of this theme is that it is broad and covers many sectors, ranging from health tests and diagnostics to cybersecurity, including the security of people and property, with international players. This market is thus valued at 1,400 billion dollars. Managers also appreciate its resilience, as the security budget is rarely cut in a company.
Global or more targeted funds
A handful of funds provide comprehensive exposure, such as Pictet Security, from Pictet AM, and Thematics Safety, from Thematics AM, a management company affiliated with Natixis IM. Both exclude the defense sector, considered opaque and whose development is closely linked to public spending. There are also different supports allowing you to target the cybersecurity angle alone, which has been particularly attractive in recent years due to its technological component. The choice here lies between actively managed products, such as the Allianz Cyber Security fund operated by Allianz Global Investors, or ETFs – index funds – such as iShares Digital Security, managed by BlackRock, one of the most diversified.
AI opens a new field for hackers
According to Allianz GI, cybersecurity encompasses several aspects: IT security, IT disaster recovery as well as end-user training. These financial vehicles are largely exposed to the shares of American companies, which dominate the sector. It is promising because online attacks are increasing. According to the World Economic Forum, they would cost 6,000 billion dollars per year, leading to numerous bankruptcy filings among SMEs in particular. Companies are therefore encouraged to increase their budgets to protect themselves. Especially since the rise of artificial intelligence opens up a new field for hackers.
The two sides of security in the broad sense have progressed well in 2024, with + 18% for the testing dimension, according to the thematic indicators of Galilee AM, and + 16.8% for cybersecurity.