A few weeks ago I wrote I’m a baby boomer. If you haven’t read it yet please read that blog before you come back to this one. Even if you have read it before, a reminder wouldn’t go amiss. At the end of that blog I promised to describe how my investment decisions have been formed by taking this huge bulge in the developed world’s population into account.
Have you noticed how people of a certain age go on about their health? I include myself in this. Any client who has seen me lately will have probably regretted asking my how I am doing. Why? Because I then took 15 minutes of their precious life away describing my recent stomach issues and the wonder drug Omeprazole. I’m sure many regretted asking me, but others had not only heard of H. Pylori but had used Omeprazole too. Omeprazole is one of the most widely prescribed drugs in the world and it is available over the counter in many countries. May I say a personal thank you to a French pharmacist here, for allowing me to get another fix when my prescription had run out.
Anyway mustn’t grumble.
When I rebalanced client portfolios in October I introduced the L&G Global Health and Pharmaceutical Index Trust. It is an Institutional Fund only open to larger amounts of money and it gives me access to some of the largest companies in the world for only 0.3%p.a.. They offer a retail version but the charges are around 1% higher. This pharma fund was one of my “Pig in the Python” themed funds. Us baby boomers weren’t getting any younger and the global pharmaceutical industry is a beneficiary of this. Maybe all the wonder drugs have been discovered and all the old money spinners were running out of their patent protected period, but the ageing population continues to rise and requires these drugs in ever greater quantities. I thought it was a great, steady, long-term dividend play. It’s probably too early to say whether I was right or not but the track record and the recent performance (when everything else has been going up also) looks promising.
What else have we 50,60 and 70 year olds been buying along with our pills and potions to keep us in tip-top health? We are definitely not ready for the Zimmer’s and the Stannah’s. No, my clients have been trading up to the other type of tablets – iPads. And Smart-phones. I will talk about the Technology fund we invest in next time.