The Silver Economy refers to the sum of all economic activities serving the needs of the elderlies. It is expected to be a mega trend in the near future thanks to the projected growth in the global size of older population within the next few years.
In this article, we will take a closer look at the sectors that are benefitting from this trend and inform how readers can gain from it with Crea8.
With more time on their hands, seniors are expected to spend big on leisure and tourism.
According to a Eurostat survey, tourists aged 65 or over accounted for nearly 1 in 4 tourism nights for private purposes by EU residents in 2018, while people aged 55+ accounted for 41 % (“Tourism Trends And Ageing – Statistics Explained” 2020).
Seniors also were seen to make longer trips, possibly due to the extra time on their hands, and prefer to stay in non-rented accommodation.
Hence, as more people move into retirement, the tourism industry and especially hotels will likely see greater demand.
As the global population becomes older, the demand for healthcare services increases. Pharmaceutical companies, drug retailers and biotechnology anticipate a strong increase in demand.
As people age, two sectors to watch are the ophthalmic (eyes) and audiology (hearing) markets. The size and scale of these markets should not be underestimated. These two sub-sectors could be key discretionary areas of spending for Silver Economy consumers looking to improve their quality of life.
Nevertheless, the human body may deteriorate as they age, and companies which are positioned to aid in holding back the effects of ageing and improve quality of life could see rising popularity amongst the Silver Economy consumers.
Worldwide growth in life expectancy goes hand in hand with increased demand for insurance products and wealth management services.
Life and pension insurance schemes benefit from this in particular. In countries which do not have modern social insurance systems that cover living costs, the demand for private retirement provision products is rising. Most insurers invest significant resources in developing tailored solutions for this target group.
Meanwhile, a greater shift towards individual responsibility for retirement savings has provided opportunities for asset managers. As the world ages, and people need to save more for retirement and healthcare, the asset management industry is expected to expand, catering for the mass-affluent baby boomers as well as handling money from pension funds.
Silver investment strategies have been around for a while but many have struggled to provide a portfolio of stocks that can maximise returns from this trend.
The issue is that inherently heterogeneous firms can benefit from the Silver Economy in different ways. Thus, investing in the Silver Economy requires careful analysis of the goods and services this group will demand before adopting a specific investment strategy
Nevertheless, Crea8 has dedicated time to analyse the market and put together an investment strategy with a portfolio of stocks that will maximise returns from this trend. The ‘Global Ageing Society’ investment strategy lets you ride on this trend by investing in the stocks of companies that will benefit from the ageing population trend.
Through Crea8’s Factor Based Thematic Investing Service, you get the opportunity to invest in this trend.
Looking for all the stocks to invest in this megatrend might turn your hair grey. Instead of that, try out our Factor Based investing service to get an easier way to invest in stocks that stand to benefit from increased adoption of electric vehicles and driverless cars around the world.