(Bloomberg) — A distinct segment issuer is launching a biotechnology exchange-traded fund whose key holdings embody companies benefiting from the hype round weight-loss medicine.
The Tema Cardiovascular and Metabolic ETF (ticker HRTS) tracks firms concerned within the remedy of cardio-metabolic ailments — a time period that hyperlinks cardiovascular ailments, weight problems and diabetes. The ETF, which has a novel investing mandate on this planet of thematic allocations, prices a 0.75% administration price.
The actively managed fund has 20 to 25 core positions, together with Eli Lilly & Co. and Novo Nordisk A/S, in addition to Arrowhead Prescription drugs Inc. and Bridgebio Pharma Inc., mentioned Maurits Pot, founder and chief govt officer of Tema ETFs.
Its launch coincides with a interval of heightened consciousness surrounding a brand new technology of weight problems medicine. The listing consists of Novo’s Ozempic — initially used to deal with diabetes — and Wegovy, in addition to Eli Lilly’s diabetes drug Mounjaro and Zepbound, which not too long ago obtained approval to deal with weight problems. Novo’s American depositary receipts are up greater than 50% this 12 months whereas Eli Lilly’s shares rallied greater than 60%.
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Pot says HRTS is seeking to spend money on structural traits slightly than journey momentum trades.
“We don’t give attention to what’s sizzling as we speak,” he mentioned in an interview.
Whereas HRTS already has well-established rivals just like the $6.4 billion iShares Biotechnology ETF (IBB) and the $6 billion SPDR S&P Biotech ETF (XBI), Pot mentioned Tema’s ground-up, research-driven method units it aside. The brand new fund’s portfolio supervisor is David Music, a health care provider who has over 25 years of life-sciences investing.
“I like that they’re utilizing a specialist for the respective theme,” mentioned Athanasios Psarofagis, Bloomberg Intelligence ETF analyst, referring to the portfolio supervisor. “It’s a really attention-grabbing play as a result of they’re taking thematics as much as one degree greater since its extra particular in comparison with different thematic funds.”
Total, buyers have yanked $4.7 billion from thematic ETFs to this point this 12 months, in contrast with $2.4 billion final 12 months, in line with Bloomberg Intelligence knowledge. Such funds had boomed in the course of the pandemic, garnering $46 billion in 2020 and $49 billion in 2021, the info confirmed.
HRTS is the second fund in Tema’s life-sciences lineup. The New-York primarily based agency, which launched in 2023 and has round $40 million in belongings underneath administration, plans to debut a neurology-focused ETF — the third fund in its life-sciences roster — early subsequent 12 months, Pot mentioned.
