Guide to thematic investing

  • Understand key principles behind thematic investing
  • Understand how to manage volatility
  • Understand how to benchmark thematic funds
Guide to thematic investing
(Fernando Cferdophotography/Unsplash)


The principle behind setting up a thematic fund is investing in an area that one believes is undergoing a structural change you think will be powerful enough to ensure outperformance over a long-term time horizon.

Investor interest in thematic funds has increased dramatically in recent years, particularly since the pandemic, as social, tech, political and health themes have gained prominence.

Despite their popularity, as with any other investment strategy, it is important to understand how thematic investing works. Moreover, there is an added challenge that it can be difficult to benchmark thematic funds.

Understanding how the fees work and managing volatility in this universe are also very important.

By reading this guide, you should be able to understand key principles behind thematic investing, how to manage volatility and how to benchmark thematic funds.

The guide is worth 60 minutes of CPD.

In this guide


Please answer the six multiple choice questions below in order to bank your CPD. Multiple attempts are available until all questions are correctly answered.

  1. Why does Chloe Shea say that thematic investing is becoming increasingly attractive to investors?

  2. According to Nick Wood, which group of people might thematic funds be useful to?

  3. True or false, Chloe Shea says that thematic investing typically involves capitalising on hidden gems, which are less well-known, and smaller in size and therefore pose more of a risk.

  4. True or false, technology is a key enabler to driving long-term structural change – an important principle in thematic investing.

  5. Why does Rob Powell say that thematic funds can act as useful diversifiers in a portfolio?

  6. Which of the following is NOT considered to fall under the social theme umbrella?

Nearly There…

You have successfully answered all the questions correctly, well done!

You should now know…

  • Understand key principles behind thematic investing
  • Understand how to manage volatility
  • Understand how to benchmark thematic funds

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