An aging population is leading to a profound demographic shift known as the “Silver Tsunami.” With more Baby Boomers reaching retirement age, the demand for senior living facilities and medicinal innovation is increasing. For investors, the Fidelity Real Estate Investment ETF (FPRO) and the Fidelity Disruptive Medicine ETF (FMED) offer ways to potentially capitalize on this inevitable trend.
The aging population is changing how real estate property developers use land. In the current environment, traditional commercial real estate is facing headwinds, especially since the 2020 pandemic. However, specialized sectors in the real estate industry are thriving — this includes senior housing and other healthcare facilities.
An aging population means a greater demand for real estate properties that address assisted living, skilled nursing, and medical office buildings (MOBs). Because FPRO is an actively managed fund, Fidelity’s portfolio managers can adjust real estate exposure to include potential opportunities in clinics, senior communities, and other specialized facilities. Unlike a passive fund that’s tied to the index it follows, active management allows for this flexibility.
In addition to real estate needs, the healthcare of an aging population must also be addressed. As ongoing technological advancements take place, FMED can target companies focused on innovations that make healthcare faster, cheaper, and more effective for an aging population.
Robotic surgery and personalized genomics are examples of technologies that are driving investment capital into disruptive healthcare. The fund also targets companies engaged in technologies addressing rare diseases, immunotherapy, technology-based health care platforms, and consumer wellness.
Additionally, the fund is also actively managed. This is imperative, especially in a sector like healthcare, which is prone to regulatory shifts and binary events in clinical trials. FMED’s portfolio managers can pivot when necessary to mitigate risk or to capture upside, which again provides the flexibility a passive fund won’t have.
As opposed to simply buying a fund that provides broad exposure to real estate or healthcare, FPRO and FMED offer opportunities to capture innovation in changing times. The fund’s managers can deftly navigate the complexities of 2026. It can also address idiosyncratic risks in the real estate and healthcare sectors.
As mentioned, these funds provide a strategic path to these sector-specific opportunities with the flexibility of active management. Inherent benefits include cost-efficiency, transparency, tax advantages, intraday trading flexibility, and other factors associated with the ETF wrapper.
For more news, information, and strategy, visit the ETF Investing Content Hub.
Fidelity Investments® is an independent company unaffiliated with VettaFi LLC (“VettaFi”). These articles do not form any kind of legal partnership, agency affiliation, or similar relationship between VettaFi and Fidelity Investments, nor is such a relationship created or implied by the articles herein. VettaFi LLC is the author and owner of these articles.
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