The robots are rising, so don't miss the next major global trend
What is robotics?
Robotics is defined as the application of technological progress and/or automation into society in forms that enable the improvement of efficiency, precision and safety in many areas.
A transforming market
The global market for robotics is expected to grow by at least 10% per year up to 20251. More than 3,700 companies, including over 200 listed ones, already have a presence in this sector. And it is estimated that by the same year, the annual economic impact of the robotics industry on the global economy in terms of cost reductions and productivity gains will be in the region of $14 -33bn2.
Advancing technology has seen robots become both smarter and cheaper just as the professionally active part of the population in many parts of the world has begun to fall (e.g. China, Japan) and younger generations shun lower value-added labour. As a result, robotics is increasingly ubiquitous.
1This figure is a forecast of the total growth of the robotics market and does not constitute a guide to the performance of the AXA WF Framlington Robotech fund
2Source: BCG, BofA Merrill Lynch, 2015; this note is purely for illustrative purposes.
Why choose AXA IM to invest in robotics?
Significant investment experience by sector or theme
Health sector - since 1987
Technology - since 1999
Biotechnology - since 2001
The AXA World Funds Framlington Robotech Fund launched in December 2016, putting us among the first companies to launch a robotics fund
Strong investment teams
Two managers dedicated to the robotics strategy
60 regional and sectoral experts in equity management
19 years of experience on average
Over 400 meetings with companies’ management per year
Source: AXA IM as of 31/12/2016, unaudited. Information relating to AXA Investment Managers staff is purely for information. We give no guarantee that these people will remain employed and hold or continue to hold positions at AXA Investment Managers.
We aim to select high-growth companies that specialise in robotics and automation, mainly in the industrial, technological, production, health and transport sectors.
More intelligent and less expensive than traditional labour, so-called collaborative robots (co-bots) have been deployed to work alongside humans in an expanding number of sectors.
Robots no longer just manufacture cars, they are increasingly vocal backseat drivers and soon, it is expected they will move into the driver’s seat. This also applies to vehicles used in the logistics, goods transport and agricultural sectors.
Robotics-assisted surgery has many advantages for patients and hospitals, including more precise surgery, lower risk of infection and faster healing, helping revolutionise the healthcare sector.
Semi-conductors, software, connectors
As the robotics industry grows, so too will the demand for the hardware and software required to build them. Such components supply and control robots by providing the connectivity and intelligence needed to capture, analyse and respond to the significant quantity of information gathered.
Main risks for robotics equity investments
Risk of capital loss: Investment primarily in equities involves a risk of losing the capital invested.
Counterparty risk: Risk of bankruptcy, insolvency or failure of a compartment counterparty, which might lead to a default in either payment or delivery.
Risks of Global Investments: Investments in securities issued or listed in different countries may imply the application of different standards and regulations (accounting, auditing and financial reporting standards, clearance and settlement procedures, taxes on dividends…). Investments may be affected by movements of foreign exchange rates, changes in laws or restrictions applicable to such investments, changes in exchange control regulations or price volatility.
Risk linked to investments in emerging markets: Legal infrastructure, in certain countries in which investments may be made, may not provide with the same degree of investors’ protection or information to investors, as would generally apply to major securities markets (governments’ influence, social, political and economic instability, different accounting, auditing and financial report practises). Emerging markets securities may also be less liquid and more volatile than similar securities available in major markets, and there are higher risks associated to transactions settlement, involving timing and pricing issues.
Source: AXA IM/Bloomberg. Companies are cited for illustrative purposes only and this does not constitute a recommendation to buy or sell.