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Blockchain adoption in healthcare may spur these ETFs
The healthcare industry is slowly but surely adopting blockchain technology as part of its core operations, leading to investment opportunities in the Invesco Alerian Galaxy Blockchain Users and Decentralized Commerce ETF (BLKC ) and the Invesco S&P SmallCap Health Care ETF (PSCH A-).
According to Market.us Report, Blockchain technology is set to reach $750 billion in less than 10 years. Maintaining confidentiality regarding patient medical records is critical in the healthcare industry. And blockchain’s security capabilities could help accomplish this task. May also assist with other back-office support tasks such as invoicing and supply chain management.
“Patients gain control over their health data by deciding who can access it,” the report states. “The technology simplifies administrative processes such as invoicing and supply chain management, increasing efficiency and reducing costs. Smart contracts automate and enforce agreements, particularly useful in tasks such as insurance claims and invoicing, minimizing the need for intermediaries.”
Given its exponential growth trajectory, this may provide opportunities in blockchain-focused Exchange Traded Funds (ETFs) like BLKC. According to the basic fund description, BKLC is based on the Alerian Galaxy Global Blockchain Equity, Trusts and ETPs index (index). It is primarily composed of shares of companies materially engaged in the development of blockchain technology, cryptocurrency mining, cryptocurrency purchasing or enabling technologies, as well as ETPs and private investment funds traded over the counter linked to cryptocurrencies.
The fund’s market cap allocations provide diversified exposure, primarily to small and large cap companies. The latter comprises more than 60% of the fund as of May 8. It also diversifies its geographic exposure to companies outside the borders of the United States, although more than 70% of the fund focuses on US companies.
When it comes to innovation, small-cap companies can be at the forefront of emerging trends before their large-cap counterparts. As such, PSCH is a prime option to get ahead of the trend before larger companies adopt the innovative advancements of blockchain technology.
PSCH is based on the S&P SmallCap 600® Capped Health Care Index. It is designed to measure the overall performance of healthcare common stocks, including companies primarily engaged in the business of providing healthcare products, facilities and services, including biotechnology, pharmaceuticals, medical technology and supplies.
The fund does not focus exclusively on companies that can offer aggressive growth prospects. Its small-cap focus includes tailor-made holdings that show value, growth and a mixed bag of factors.
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