Another thematic ETF launches to target global obesity battle

The growing global concern about obesity and its impact on other health related matters is driving a surge in companies developing solutions.

For investors seeking thematic funds focused on the sector there are several options, but there is room for more and Amplify ETFs is the latest to launch an index-based fund offering exposure to those in what is known as GLP-1 treatments.

The firm, which has over $9 billion assets under management and acquired a suite of specialty funds last summer from ETF Managers Group, has announced the launch of the Amplify Weight Loss

Drug & Treatment ETF (NYSE: THNR).

The fund tracks the VettaFi Weight Loss Drug & Treatment Index which allocates 70% of drug manufacturers, those who are launching or testing GLP-1 treatments. The other 30% is allocated to ‘enablers’ or companies engaged in outsourced development and manufacturing, measurement and analysis, and/or distribution or administration of GLP-1 drugs.

With an estimated one billion people globally defined as obese and the World Health Organization recently reporting that the figure had doubled in the period 1990-2022, the scope for returns from those companies offering solutions is clear.

Last month, another niche ETF provider also launched a thematic fund focused on GLP-1 treatments. The renamed Tema Obesity and Cardiometabolic ETF trades on the Nasdaq with the ticker HRTS.

However, the thematic funds market has seen some pullback recently following the surge of interest in specialities such as work from home funds which gained during the pandemic. Investors have already yanked nearly $4 billion so far this year from exchange-traded funds investing in themes like clean energy and cloud computing, after withdrawing $4.6 billion from such funds as a whole in 2023, according to Bloomberg Intelligence. There is expectation that a rebound will come once investors recover from over-allocation to some themes which turned out to be ‘micro-bubbles’.