Edouard Dradin
23 Apr 2025
Thematic ETFs: explanation and overview
In an age of rapid innovation, geopolitical upheaval and ecological transitions, investors are looking to anticipate the major trends of tomorrow. This is precisely what thematic ETFs offer: exposure to the megatrends that are reshaping our economy and our daily lives. Whether it's artificial intelligence, green technology, blockchain or digital health, these listed index funds offer a simple, affordable gateway to long-term growth drivers. But what exactly is behind the term “thematic ETF”? And how do they differ from traditional sector ETFs? Follow the guide.
What is a thematic ETF?
In concrete terms, a thematic ETF selects companies from all over the world, across all sectors, with a strong link to a specific theme: renewable energies, cybersecurity, e-health, robotics, blockchain or defense. These ETFs enable investors to align their portfolios with strong convictions and societal, technological or environmental trends.
As a reminder, an ETF (Exchange Traded Fund), also known as a tracker, is a listed investment fund that replicates the performance of an index. In the case of thematic ETFs, the index tracked does not reflect a geographic market (such as the MSCI Emerging Markets) or a traditional sector (such as healthcare or energy), but a cross-cutting theme that is expected to benefit from long-term structural growth dynamics.
Thematic ETFs vs. sector ETFs: what's the difference?
The distinction between a thematic ETF and a sector ETF may seem blurred, but it's crucial:
Sector ETFs group together companies from the same economic sector according to a standard classification (often GICS). For example, a health care ETF groups together only companies in the health care sector.
Thematic ETFs, on the other hand, are based on a transversal idea. They can include companies from different sectors, as long as they participate in the same dynamic. For example, an ETF on artificial intelligence will contain cloud giants, semiconductor manufacturers and data processing startups alike.
In other words, sector ETFs map today's economy, while thematic ETFs try to anticipate tomorrow's.
Why invest in thematic ETFs?
There are several reasons for the growing popularity of these new-style ETFs:
- Geographic and sector diversification: by targeting a theme rather than a country or sector, these ETFs offer broader exposure.
- Consistency with personal values: thematic investing makes it possible to support causes such as the energy transition or medical innovation.
- Transparency and accessibility: ETFs remain easy-to-understand, liquid and low-cost products.
However, they are not without risk: some themes may be overvalued, lack maturity, or suffer cyclical downturns. Hence the importance of choosing the right themes - and combining them intelligently in a diversified portfolio.
Overview of major emerging themes
Let's take a look at the major trends that are attracting investors' attention.
Technology and artificial intelligence
Technology etf and AI-related ETFs are riding the wave of automation, massive data analysis, machine learning and conversational intelligence (like GPTs). With giants like NVIDIA, Microsoft, or even players specializing in semiconductors and the cloud, these ETFs capture the heart of current innovation.
ETF examples: Global X Artificial Intelligence & Technology ETF, iShares Robotics and AI Multisector ETF.
Renewable energy and sustainability
In the face of the climate crisis, the energy transition is a global priority. ETFs focusing on renewable energies, green technologies or ESG criteria (environment, social, governance) enable you to invest in the companies that are making this transition possible: solar, wind, hydrogen, batteries, resource management...
Examples of ETFs: IiShares Global Clean Energy ETF, Lyxor New Energy ESG ETF.
If this theme is important to you, please note that at Easyvest, we offer a “climate” portfolio, aligned with the Paris agreements. This enables us to satisfy even the most socially and environmentally committed clients.
Digital health and biotechnology
The pandemic has highlighted the importance of digital health, telemedicine, biotechnology and advanced pharmaceutical research. Health care ETFs provide exposure to innovative companies in medical research, genomics and connected devices.
ETF examples: iShares Nasdaq Biotechnology ETF, Global X Telemedicine & Digital Health ETF.
Blockchain, Bitcoin and Ethereum
Among the most controversial but highly promising themes, blockchain and cryptocurrencies are opening up a new paradigm. Bitcoin ETFs (and now some Ethereum ETFs) provide indirect exposure to the value of these crypto-assets, often via futures contracts or companies in the sector (such as Coinbase or MicroStrategy).
Beyond the Bitcoin price, these ETFs can also include companies active in the development of blockchain, NFT or Web3 infrastructure solutions.
ETF examples: iShares Blockchain and Tech ETF, ProShares Bitcoin Strategy ETF.
Defense and cybersecurity
In an unstable world marked by geopolitical tensions, the theme of defense is back in the spotlight. Some thematic ETFs include companies in the arms, cybersecurity or strategic infrastructure sectors.
Although ethically debatable, this theme is attracting more and more institutional investors. Cybersecurity, in particular, is a high-potential sub-theme, linked to data protection in a digital world.
ETF examples: SPDR S&P Aerospace & Defense ETF, Global X Cybersecurity ETF.
Emerging markets and digitization
Emerging markets are evolving rapidly, driven by galloping urbanization, the rise of the middle classes, and accelerated digitization. Here, thematic investing enables us to target champions of digitalization, e-commerce, mobile payments or e-learning in zones such as Southeast Asia, Latin America or Africa.
ETF examples: EMQQ Emerging Markets Internet & Ecommerce ETF, iShares MSCI Emerging Markets ETF.
Conclusion: how to integrate thematic ETFs into your portfolio?
Thematic ETFs offer a simple way of investing in promising trends: instead of selecting individual stocks linked to a theme, you simply buy a single ETF grouping together dozens or even hundreds of companies active in that field. This is an effective way of gaining exposure to a growth dynamic without falling into the stock-picking trap.
Beware, however, of overestimating their diversification: although a thematic ETF contains several companies, it remains focused on a specific idea or sector. In the event of a downturn or loss of interest in the trend in question, performance can quickly suffer. Investing in a thematic ETF therefore means making a targeted bet on the future, akin to a form of active management in disguise, even if it is passively executed.
At Easyvest, we've made a different choice. Rather than trying to anticipate which trends or companies will dominate the future, we've opted for a simpler, more robust approach: investing in a global ETF that covers several thousand companies worldwide. This allows us to capture the whole of global economic growth, without trying to guess who the next winners will be. We're convinced that, in the long term, extreme diversification and discipline win out over thematic speculation.