The world is aging rapidly, and there are increasingly more ways to take a position on this theme. Shams Afzal, managing director at Carnegie Investment Counsel, noted that 17% of the U.S. population is now over the age of 65, and that proportion is predicted to grow higher. And the demographics of that age group is changing. There’s been a “marked jump” in education levels — just 5% of those aged above 65 were degree holders in 1950, much lower than the 29% in 2018, Afzal said, citing Population Reference Bureau statistics. The gender gap by way of mortality has also narrowed, from seven years in 1990 to 5 years in 2017, he said. “The aging population discussion lately has mostly revolved around future challenges to labor productivity and its economic growth implications,” he said. “We see meaningful efforts by firms large and small, working to reinforce the standard of life for people on this age group,” Afzal, also a portfolio manager on the firm, told CNBC Pro . CNBC Pro asks expert investors in the realm what the emerging trends are and the stocks to purchase. AI, robotics and wearables The aging population stands to realize significantly from breakthroughs in robotics powered by artificial intelligence, in accordance with Afzal. One example might be a robotic personal assistant, he said, flagging one company to look at: Figure, which is developing a robot able to performing household tasks, conversations and business applications. Nonetheless, the corporate is just on the enterprise capital stage of financing. On the subject of health care, Afzal also flagged the increasing use of robotics in surgery. He cited studies that show that the necessity for hip, knee and other joint substitute procedures surge when people reach their late 60s and early 70s. Medical devices firm Stryker is one stock to play the theme, he said. “This can be a large tailwind for Stryker. It’s … positioned to learn from an ageing population within the US and EU and from increasing adoption of robotics in surgeries across the remainder of the world,” he said. Stryker’s surgical robots are “gaining momentum” in knee replacements, and its next generation of robots are expected to tackle the spine, in accordance with Afzal. He said the stock is a “regular double-digit earnings grower” and experiencing healthy backlogs for its products which are “necessities in an operating room.” Pacific Asset Management’s Dani Saurymper also highlighted AI as a possibility within the aging theme. Examples include robot-assisted surgery, treatment planning software and virtual nursing assistants, the portfolio manager said. Saurymper manages the Pacific Longevity and Social Change Fund. Arelis Agosto, research analyst at Global X ETFs, said wearables technology is one interesting area to take a position in for the aging theme. “Many chronic illnesses require frequent measuring of vitals, where continuous monitoring via wearable sensors could make a noticeable difference,” she said. Continuous glucose monitors are one example, in accordance with her. They’re sensors placed under the skin that measure glucose levels and robotically transfer data to a wise device. Insulin pumps are one other example. They’re small wearable devices that deliver insulin to diabetic patients. When used along with continuous glucose monitors, the pump adjusts insulin levels based on the patient’s blood glucose readings, Agosto noted. “We view self-sustaining monitoring and therapeutic systems as the long run of patient care, though it is especially useful for elderly patients,” Agosto said. Global X ETFs, a fund management company, offers a solution to tap the aging theme through its Aging Population ETF. For those searching for individual stocks, Afzal of Carnegie flagged Abbott Laboratories , particularly its continuous glucose monitoring business — which sells the FreeStyle Libre product. He highlighted it as an “area to look at,” noting that Abbott’s vision is to rework the product right into a “lifestyle wearable sports device that becomes a part of one’s tech ecosystem.” Education Education is one “great example of where multiple longevity themes intertwine,” said Saurymper. About 33% of physicians shall be 65 years or older by 2030, and industry surveys predict there shall be a shortfall of 140,000 physicians within the U.S. in 10 years’ time, he said. “As society ages, demand for healthcare professionals will only increase,” said Saurymper. He named one stock to contemplate on this theme of coaching health-care professionals: Adtalem , a medical and health-care education company. It offers a wide range of health-care programs, including nursing and licensed physician degrees, and will profit from the demand-supply imbalance, he said. Screening and prevention Agosto of Global X ETFs highlighted one recent major trend related to the aging population: the push toward preventative medicine. “The GLP-1 category is a fantastic example of the success treatments can see in the event that they have broad reaching potential to assist prevent chronic illnesses,” said Agosto. GLP-1 drugs, originally developed as a treatment for diabetes, is now also getting used for weight reduction. Here’s how one can put money into this category. She said that obesity accounts for 80% of the danger of developing Type 2 diabetes, which one in every 4 elderly patients live with. “We view the broader shift to enhance the care of chronic illnesses and the increased give attention to prevention of such diseases as the only most vital growth driver for the aging population theme,” said Agosto. Throughout the screening space, Saurymper likes Hologic , which makes and supplies premium diagnostic products and medical imaging systems. The firm has begun to make use of AI-powered algorithms to expedite mammogram reading times and to reinforce cancer detection in its image analytic products, he said.
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