- BioNTech’s vaccine trial with Pfizer has boosted this holding to a top
10 holding in our technology ETF.
- Genomics, Social Media and Future Cars were the biggest contributors to
monthly performance.
- With US exposure at 56.1%, Asia hit a new high of 30.0% weighting, and
Europe rose to 13.0%.
Performance Review
HAN-GINS Tech Megatrend Equal Weight UCITS ETF (ITEK) is
benefiting from the enlarged Genomics and Digital Entertainment subthemes. Genomics remains our largest weighting at 15.13%,
ahead of the next rebalance, followed by Future Cars (15.00%) and Robotics
(14.62%). For 2020, our technology ETF is now up 28.68% and over the past 12 months, 40.26%.
During October, the standout subtheme performers were Social Media
and Genomics, as the broader tech industry awaited the outcome of the US
election and struggled to reaching new highs following impressive gains earlier
in the year.
ITEK Monthly Report
October
|
12 Month*
|
-0.11%
|
40.26%
|
Past performance is no guarantee of future performance.
Source:
Bloomberg/ HANetf
*12 Month figures
based on 01.11.19 - 31.10.20
The leading performers in October continued to benefit from
COVID-19 vaccine research and remote working behaviours becoming the norm. Our Genomics sub-theme performed well, with impressive
growth from Exact Sciences (up 21.5%), BioNTech (23.3%) and Corteva (14.5%). Social Media’s impressive gains were led by
Pinterest (up 42.0%), Weibo (14.1%) and Alphabet (14.5%).
Robotics & Automation firms also feature positively in October,
led by Fanuc (10.6%), Rockwell Automation (7.5%) and Xilinx (13.9%). Riot Blockchain posted impressive gains of
21.1% for the month.[1]
The pandemic continues to boost Social Media and Genomics constituents
as the search for a vaccine and personalized medicine needs continue to grow, given
the US’s aging population. ITEK contains
the majority of leaders across the Fourth Industrial Revolution and shows far
less volatility than the top heavy Nasdaq and MSCI Tech indices. ITEK’s equally weighted approach ensures
performance is far more diversified and globally based.
Past performance is
no guarantee of future performance
Source: Solactive FactSet and Bloomberg. Data as of 31/10/20
HAN-GINS Tech Megatrend Equal Weight ETF- Performance
Total Return NAV to
Date (up to 01/11/19 – 31/10/20)
|
1M
|
3M
|
6M
|
YTD
|
12M
|
Since Inception
|
HAN-GINS Tech Megatrend Equal Weight UCITS ETF (Acc)
|
-0.11%
|
4.63%
|
31.56%
|
28.68%
|
40.26%
|
49.20%
|
Solative Innovative Technologies Index (NTR)
|
-0.09%
|
4.70%
|
32.02%
|
29.07%
|
40.97%
|
50.83%
|
Past performance is
not an indicator for future results and should not be the sole factor of
consideration when selecting a product. Investors should
read the prospectus of the Issuer (“Prospectus”) before investing and should
refer to the section of the Prospectus entitled ‘Risk Factors’ for further
details of risks associated with an investment in this product. Source:
Bloomberg / HANetf. Data as of 31/10/20
Innovative Technology News
The Biden presidency, coupled
with a likely Republican controlled Senate, is positive for Big Tech and the
broader innovation and digital revolution theme, with a divided US government
ensuring no extreme economic or tax policy.
Any tax increases will be more
muted, ensuring Big Tech does not suffer when repatriating their overseas
earnings. Key Big Tech implications are:
- Most likely a new US nationwide data protection (privacy)
law – similar to the EU’s GDPR.
- A new Consumer Privacy Protection Bureau is likely.
- Healthcare spending is set to increase, ensuring a
bright future for Genomics companies.
With COVID-19 cases increasing
across the US and Europe, remote technologies continue to be well positioned
for growing rates of adoption, as permanent behavioural changes occur.
Social Media, Digital
Entertainment and Cloud Computing will continue to see the mainstreaming of
their offerings. The popularity of videogames on smartphones and tablets is
growing at a record pace. Free mobile
gaming is exploding, with advertising offsetting the cost. Meanwhile, Cloud leaders Amazon, Microsoft,
Google, Alibaba and Nvidia have recently launched or announced cloud-gaming
services.[2]
We expect a lot more venture
capital and M&A deal flow in the gaming area. Other areas of digital
entertainment (music and videos) are also seeing fast track growth globally.

For illustrative purposes only
Source: Newzoo, 2020 Global
Games Market Report
The global video streaming market
was estimated at $42.6bn in 2019 and is expected to reach $50.1bn in 2020. This reflects an estimated
compound annual growth rate
of 20.4% from 2020 to
2027, reaching $184.2bn by 2027.[3]
Innovations, such as Blockchain technology and Artificial Intelligence (AI) will enhance video quality and boost market growth. AI now
plays a key role in video/film editing, cinematography, voice-overs,
scriptwriting and video production.
Fund Rebalance News
On September 9th our technology ETF was rebalanced as part of the regular twice-yearly
process. The number of holdings has
risen from 86 to 104. This includes 36 new additions and 18 deletions.
All 8 subthemes are represented with holdings and are equally weighted. This ensures each holding has an approximate
1% weighting.
Key additions include:
- Digital Entertainment has
been added as a new subtheme. The subtheme includes our existing Virtual
Reality subtheme, but is now far broader. Given the growth of online
streaming devices for movies, music and gaming, we felt it was important to capture
these growing trends. Amongst the 15 new holdings, these include Netflix,
Spotify (music), plus Nintendo and Activision (leading gaming companies).
- The Genomics (Gene Therapy) subtheme definition has
also been expanded to fully capture all the new activity occurring across the
gene therapeutic and editing arenas. Consequently, eight new firms have been included – including Illumina and Agilent both global leaders (US
based) in their respective genetic fields of genetic variation analysis
and gene quality control/data analysis.
- Cloud Technology - this
mirrors the Top 15 holdings held in our HAN-GINS Cloud Tech ETF. ITEK
Cloud holdings were updated in line with our Cloud ETF holdings which were
rebalanced in July. Recent additions included Twilio and Zoom Video. This
subtheme now more accurately captures the full scope of Cloud activity –
including cloud security companies, plus cloud communications and conferencing
firms.
Each of our 8
subthemes holds a maximum of 15 holdings, with each of these holdings equally
weighted. In turn each subtheme is equally weighted in the ETF. The
8 subthemes represented are:
1. Social Media
2. Cloud Technology
3. Genomics
4. Robotics and Automation
5. Digital Entertainment
6. Cybersecurity
7. Future Cars
8. Blockchain
Constituent News
Following our September rebalance, ITEK more fully represents the
Digital Revolution. Due to the global-nature
of these technology megatrends, our US exposure continues to be reduced,
currently representing just 56.13%, with Asia hitting a new high of 29.99% and
Europe at 13.01%. Our largest holdings
are barely above 1.5%, due to the equal weighting of all 104 holdings. This is in stark contrast to the Nasdaq 100
and other top-heavy technology benchmarks.
Pinterest is our largest holding currently due to recent gains
–with a weighting of 1.79%, followed by Exact Sciences (1.59%), NIO (1.55%) and
Zoom Video and BioNTech (1.37%). With
the Pfizer-BioNTech successful vaccine trials just announced, BioNTech has
jumped another 15% and is now a top 3 holding.
NIO, a Chinese electric vehicle firm, saw its stock jump over 9% in
October due to impressive car deliveries; deliveries in October almost doubled
year-over-year to 5,055 vehicles.[4] NIO has a home court advantage
over Tesla in the massive Chinese EV market.
For October, our Top 20 contributors to performance are broadly
spread across Social Media, Genomics, Future Cars, Robotics & Automation,
and Digital Entertainment. Pinterest
contributed the most to ITEK’s performance (0.49%), followed by Exact Sciences
(0.42%), NIO (0.24%), BioNTech (0.14%) and Weibo (0.12%). During October, our Cybersecurity and Cloud
Computing themes created the most drag on performance with a contributing loss
of 1.4% and 1.01%. This was largely due
to their strong earlier runs prior to October – and some profit taking during
the month.
Sub-them Performance- October
Contribution
|
Total Return (%)
|
% Average Weight
|
% Performance of category
|
Genomics
|
0.33
|
15.13
|
2.28
|
Digital Entertainment
|
-0.36
|
13.94
|
-2.86
|
Robotics & Automation
|
-0.34
|
14.62
|
-2.60
|
Blockchain
|
-0.14
|
1.54
|
-9.66
|
Future Cars
|
0.17
|
15.00
|
1.28
|
Cloud Computing
|
-1.01
|
13.48
|
-7.97
|
Social Media
|
0.45
|
13.52
|
3.90
|
Cyber Security
|
-1.4
|
12.78
|
-11.42
|
Top Performance Contributions- October
Holdings
|
Index Category
|
% Average Weight
|
Total Return (%)
|
Contribution to Return (%)
|
Pinterest Inc
|
Social Media
|
1.79%
|
42.01
|
0.49
|
Exact Sciences Corp
|
Genomics
|
1.59%
|
44.11
|
0.42
|
NIO Inc
|
Future Cars
|
1.55%
|
21.46
|
0.24
|
Zoom Video Communications Inc
|
Cloud Computing
|
1.37%
|
23.30
|
0.21
|
BioNTech SE
|
Genomics
|
1.35%
|
14.05
|
0.14
|
Weibo Corp
|
Social Media
|
1.24%
|
16.07
|
0.12
|
MediaTek Inc
|
Robotics & Automation
|
1.21%
|
10.62
|
0.11
|
Baidu Inc
|
Social Media
|
1.19%
|
12.37
|
0.10
|
SINA Corp/China
|
Social Media
|
1.17%
|
13.87
|
0.10
|
FANUC Corp
|
Robotics & Automation
|
1.16%
|
13.31
|
0.08
|
Region Breakdown
|
Weight
|
North America
|
56.13%
|
Asia
|
29.99%
|
Europe
|
13.01%
|
MENA
|
0.87%
|
Past
performance is no guarantee of future performance
Source of all data: Solactive / FactSet and Bloomberg / HANetf. Data as of 31/10/20
Fund Details
HAN-GINS
Tech Megatrend Equal Weight UCITS ETF (ITEK) is a UCITS compliant Megatrend ETF
domiciled in Ireland. Our technology ETF tracks the Solactive Innovative Technologies Index
(Net Total Return), an index of leading companies that are driving innovation
in sectors including Robotics & Automation, Cloud Computing & Big Data,
Cyber Security, Future Cars, Genomics, Social Media, Blockchain and Augmented
& Virtual Reality.
The
Solactive Index is managed according to a published, rules-based methodology.
It is designed to measure the performance of an investable universe of
publicly-traded companies that are involved in innovative and disruptive
technological trends across a broad range of industries mentioned. To be
included, companies must derive a majority of revenue from one of these themes.
Please
remember that the value of your investment may go down as well as up and past
performance is no indication of future performance.
EXCHANGE
|
BB CODE
|
RIC
|
ISIN
|
CURRENCY
|
INCOME
|
London Stock Exchange
|
ITEK LN
|
ITEK.L
|
IE00BDDRF700
|
USD
|
Acc
|
London Stock Exchange
|
ITEP LN
|
ITEP.L
|
IE00BDDRF700
|
GBP
|
Acc
|
Borsa Italiana
|
ITEK IM
|
ITEK.MI
|
IE00BDDRF700
|
EUR
|
Acc
|
XETRA
|
T3KE GY
|
T3KE.DE
|
IE00BDDRF700
|
EUR
|
Acc
|
SIX
|
ITEK SW
|
ITEK.S
|
IE00BDDRF700
|
CHF
|
Acc
|
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