Global X ETFs releases new Telemedicine & Digital Health ETF tracking ARTIS®-based Solactive Index
Digitization continues to permeate many areas of society’s everyday life. The healthcare sector is a prime example of this trend, as a historically localized and analog industry increasingly adopts digital solutions to improve health outcomes and reduce costs. To capture the growth potential associated with this theme, Global X ETFs is introducing the Telemedicine & Digital Health ETF (EDOC), which includes companies both providing or are affiliated with digital medical services and digital healthcare.
According to recent statistics, the global digital health market is expected to reach a value of USD 504.4 billion by 2025, growing with an expected CAGR of 29.6 percent from 2019 to 2025[1]. Investors, who want to participate in the potential growth of the digital health market, now have the opportunity to invest in a basket of companies pooled into EDOC, which tracks the Solactive Telemedicine & Digital Health Index.
The Solactive Telemedicine & Digital Health Index includes companies that are active in at least one of the four segments: Telemedicine, Healthcare Analytics, Connected Healthcare Devices, or Administrative Digitization. Companies operating in the Telemedicine sector connect physicians and patients digitally, facilitating a range of medical activities that include, for example, diagnosis, treatment, and medication management. Healthcare Analytics deals, i.e., with the collection, production, utilization, and/or data storage for healthcare-related statistical and/or computational analyses.
Companies affiliated with Connected Healthcare Devices develop healthcare devices, which, i.e., automatically transmit data and results to patients and/or physicians for real-time assistance or dynamic patient treatment. Additionally, companies serving in the Administrative Digitization sector play a crucial role in innovative healthcare provider management processes, including, i.e., patient intake, staffing solutions, digital healthcare security, or doctor/hospital search, booking, and rating.
The index component selection is based on Solactive’s proprietary Natural Language Processing algorithm ARTIS®, which utilizes advanced algorithms to parse large volumes of public documents evaluating companies’ relevancy to various themes or topics, and considers both a company’s exposure and importance to the theme.
Timo Pfeiffer, Chief Markets Officer at Solactive, comments: “Not so long ago, to receive a doctor’s prescription required me to show up at the doctor’s office even with 103° F. Additionally, most digital ‘health advice’ I could get was in form of exaggeration found in online forums. Luckily, times change, and digital health and telemedicine gained a lot of credibility, making both subjects a very interesting opportunity for investors, who believe in the progress of healthcare and digitization.”
The Global X Telemedicine & Digital Health ETF started trading on July 30th, 2020, on Nasdaq.
[1] Source: Statista, online: https://bit.ly/3fWTHsT