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What are Megatrends and how is it relevant to investing?

Megatrends are powerful, transformative forces that could change the global economy, business and society. Megatrends have been changing the way we live for centuries. But how are megatrends relevant to investing?

A new report by BlackRock Investment Management has identified five megatrends it believes are shaping the investment landscape. The report delves into each of these five forces that propagate some of our most powerful investment themes.

Here are the 5 megatrends:

  1. Technological breakthrough
    This year, over half of the world’s population is expected to have access to the internet for the first time.
  2. Climate change & resource scarcity
    Eighteen of the 19 warmest years on record have all occurred since 2001. 2018 was the fourth warmest year recorded to date.
  3. Demographics & social change
    In two years, the working age population in advanced economies is set to begin shrinking for the first time in history.
  4. Rapid urbanisation
    By next year, over 50% of Asia’s citizens are expected to live in urban areas for the first time.
  5. Emerging global wealth
    Within the next four years, India is expected to overtake China as the most populous nation in the world.

According to the report, “interconnectivity” in the world today means none of the five trends exists in isolation. The report states that “when the trends collide and overlap, new investment themes appear.”

“Megatrends will have meaningful impact not just on how we live and how we spend money, but also on government policies and corporate strategies”, it says.

Click here to download the report that shares investment opportunities per megatrend.

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