Korea Investment Trust Management announced on the 18th that it will newly list two exchange-traded funds (ETFs) investing in bio stocks on the 19th. The two products are the ACE Global Big Pharma ETF and the ACE Eli Lilly Value Chain ETF.
The ACE Global Big Pharma ETF is a product that includes 15 representative large pharmaceutical companies (Big Pharma) in the global market. Big Pharma companies are characterized by excellent capital strength and a strong economic moat based on blockbuster drugs with annual sales exceeding 1 billion dollars.
The ACE Global Big Pharma ETF plans to selectively invest in Big Pharma companies with top-tier expected sales growth rates over the next three years. This methodology reflects not only current trends but also future growth potential, and after inclusion, the index weighting will be adjusted according to sales increases or decreases. The underlying index is the 'Solactive Global Big Pharma Index Price Return' KRW-converted index.
The ACE Eli Lilly Value Chain ETF is a product that focuses investment on the global healthcare company Eli Lilly. Eli Lilly is a company with strengths in areas such as diabetes and obesity treatments. Since 2023, it has maintained the number one market capitalization among pharmaceutical and bio companies.
The ACE Eli Lilly Value Chain ETF also includes 14 core value chain companies collaborating with Eli Lilly. This is an operational strategy reflecting the recent trend of specialization among Big Pharma companies. Eli Lilly also develops about 50% of its new drugs through external partnerships. The underlying index of this ETF is the 'Solactive Eli Lilly Value Chain Price Return Index' KRW-converted index.
Nam Yong-su, head of ETF operations at Korea Investment Trust Management, explained, "Global Big Pharma companies have shown steady growth thanks to new drug development such as obesity treatments," and added, "The global pharmaceutical market, which was about 1.557 trillion dollars in 2023, is expected to grow to 1.917 trillion dollars by 2027."
He continued, "When investing in the pharmaceutical and bio industry, it is necessary to selectively invest in companies that are expanding their market dominance," emphasizing, "The newly listed ACE Global Big Pharma ETF and ACE Eli Lilly Value Chain ETF will be good means to efficiently invest in the growing pharmaceutical and bio industry."
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