Beyond Baby Boomers - Amazon Web Services · 6/30/2018 · Outline of the 2017 Beyond Baby Boomers Survey ... Basics of the 2017 Survey of Affluent Gen X’ers & Millennials •

Proprietary & Confidential

2018

Beyond Baby BoomersThe Investable Assets of Tomorrow


About Us

© GLOBAL X MANAGEMENT COMPANY LLC. All numbers are approximate. 2

Global X’s Mission

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Founded in 2008, we are distinguished by our smart core, income, alpha, risk management and access suites of ETFs, and have more than 50 funds available across U.S. and foreign exchanges. Global X is recognized as a leader in developing intelligent investment solutions for our clients.

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To listen to and empower customers to invest wisely in unexplored and intelligent solutions

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based solutions, which provide

the potential for better

outcomes

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Our funds’ systematic, published

methods eliminate manager

drift and are available to every

customer


About Us


Thematic

Growth

12 ETFs

$11

$65 $897

$1,5

23

$389

$3,1

58

$4,0

20

AUM ($ Millions) as of June 30, 2018

• Targeting companies that may be poised to benefit from structural shifts in technology, people and demographics, and infrastructure development

• Offering solutions for investors seeking to increase or diversify the yield potential of their portfolio

• Serving as key portfolio building blocks that seek to deliver exposure to specific factors, values, or geographies

• Including targeted sector exposure to China, along with single-country and regional strategies

• Seeking to align opportunities for exposure to natural resources across a variety of areas, but chiefly in metals, mining, and agriculture

• Goal of delivering market-beating total returns by following methodologies backed by academic research

• Seeking to reduce or manage volatility to guide investors through changing market environments

Risk

Management

2 ETFs

Alpha

2 ETFs

Commodities

5 ETFs

International

Access

15 ETFs

Core

7 ETFs

Income

11 ETFs


Outline of the 2017 Beyond Baby Boomers Survey


Basics of the 2017 Survey of Affluent Gen X’ers & Millennials

• Global X conducted independent

research via a third party partner in

Q1 2017

• The survey was structured to

investigate the specific investment

needs and wants of affluent

Gen X’ers and Millennials

Profile of Survey Participants

Major takeaways for FAs

1

2

3

The value of human advice remains high

FAs should become more tech savvy

FAs should to increase their knowledge of thematic investing

4 Connecting how and when affluent Gen X’ersand Millennials want is key


The Value of Human Advice Remains High


Looking to increase assets managed by an advisor

Comments

• While robo-advisors do present a new kind of option for Millennials and Gen X’ers, our survey found that these younger generations are far from finished considering increasing assets managed by a human

• If you are a financial advisor, a question to ask yourself might be “How can I capture more of these assets?”

o Our survey sheds some light, and the answer isn’t mystifying.

o Simply put: “Connect with them how they want and when they want.”

1


FAs should become more tech savvy


How important are tech capabilities?

2

What does “Tech Savvy” mean?1

Comments

• It isn’t news that being “Tech Savvy” is basically table

stakes to winning over Millennials and

Gen X’ers.

• That noted, we were still surprised at just how important it

is.

• Stay tuned for more info on the importance of Social

Media…

1Other ranking options included social media presence, educational videos, webinars, podcasts & blog


Interest in Thematic Investing?

FAs should increase their knowledge of thematic investing


3

Which Thematic Trends Are They Most Interested In?

Comments – Get Smart on Thematic Investing!

Millennials and Gen X’ers are much more interested in Thematic Investing than the average Joe, and they are interested in themes that run the gamut from investing alongside their personal values to investing in disruptive technologies.


Preferred Frequency of Interaction – Set a Cadence!

Connecting how and when affluent Gen X’ers and Millennials want is key (1/3)


4

Comments

In terms of desired frequency of communication, Gen X’ers seem

to be just a bit more high maintenance than Millennials, but a

grand majority of both groups prefer to interact with their advisors

quarterly or more.


Preferred Social Media Platforms



4

Comments

Having a social media presence is key to connecting with these younger generations,

and if an advisor has only a LinkedIn profile, he/she is not connecting with Millennials and

Gen X’ers via their preferred networks. The strong preference for Facebook and

Instagram could indicate that it’s important for Millennials and Gen X’ers to see how their

advisors live their personal lives. This insight may expand the feeling of connection and

trust between advisor and client.


Being in the Know about Life Events



4

Comments

When an advisor connects with his/her clients via social media, some

life events, such as marriage or births/adoptions, will come through those social media feeds. It’s also possible that something like the loss

of a parent will be noticeable on a client’s social media account.


Key Takeaways – What Do Affluent Gen X’ers and Millennials Really Want? (1/2)



Key Takeaways – What Do Affluent Gen X’ers and Millennials Really Want? (2/2)



What is Thematic Investing?


Thematic investing refers to the process of identifying powerful macro-level trends and the underlying

investments that stand to benefit from the materialization of those trends.

1. Top DownIdentify powerful macro-

level trends

2. Bottom UpFind investments with high

exposure to those trends

Process

Characteristics

• Long term growth-focusedstrategy

• Unconstrained by arbitrary geographic and sector

definitions

• Low correlation to other growth strategies

• Relatable concepts


Is Thematic Investing ‘Niche’?


“Why is thematic investing a good idea? In a rapidly changing business environment, the winners will be those that anticipate trends

and take advantage of new opportunities.”(Source: “Thematic Investing”)

“We believe that thematic investing can outperform in the brave, new, post-QE world; that early, contrarian theme adopters can benefit from its low frequency investment style; and that capital flows are increasingly theme driven.”

(Source: “A Transforming World”)

“Investors who are willing to follow the insights of such long-term themes over multiple business cycles can benefit from potential mispricing created by the typically shorter-term focus of financial markets.”(Source: “House View: 2016 and Beyond”)

“Many are turning to ‘thematic’ investment strategies. That was the most intriguing insight we took from a series of interviews we conducted in 2013 with about a dozen pension funds, sovereign-wealth funds, and other institutional investors.” (Source: “From Indexes to Insights: The Rise of Thematic Investing”)

For years, sophisticated institutional investors have engaged in or advocated for thematic investing.

Given high costs of research, however, it has largely been unavailable to retail investors

Merrill Lynch

McKinsey &

Company

UBS

Towers Watson

QuotesThought-leaders


Where Does Thematic Investing Fit in a Portfolio?


Thematic strategies fit best in

a portfolio when:

• The portfolio is growth-

oriented

• The client has a longer

time horizon

• It replaces core or growth

equity exposure, keeping

asset allocation generally

the same

Fixed

Income, 30%

Thematic, 10%

Core Equities,

50%

Equities, 60%

Alternatives,

10%

Thematic investing tends to:

• Be alpha-seeking

• Have a long time horizon

(>5 years)

• Be growth-oriented

• Be equity-based

Thematic investing is typically a satellite position or an equity sleeve in a growth-oriented portfolio

Equity Sleeve

Hypothetical Growth Portfolio

Proprietary & Confidential© GLOBAL X MANAGEMENT COMPANY LLC. All numbers are approximate. 16

Global X has 12 ETFs designed to target disruptive structural changes1

1. As of 6.30.2018.

Global X’s Thematic Growth Suite of ETFs

Targets companies that may benefit from structural changes in people and

demographics, technology and innovation, the availability of resources.

INFRASTRUCTURE

Social Media ETF (SOCL) Millennials Thematic ETF (MILN)

U.S. Infrastructure Development ETF (PAVE)

Lithium & Battery Tech ETF (LIT) Longevity Thematic ETF (LNGR)

FinTech ETF (FINX) Health & Wellness Thematic ETF (BFIT)

Internet of Things ETF (SNSR) Iconic U.S. Brands ETF (LOGO)

Robotics & Artificial Intelligence ETF (BOTZ)

Autonomous & Electric Vehicles ETF (DRIV)

Future Analytics Tech ETF (AIQ)


What is Driving the Growth of Robotics & AI?

17© GLOBAL X MANAGEMENT COMPANY LLC. All numbers are approximate.

Robotics and AI is a rapidly emerging theme because there are large economic incentives relating to

aging populations, rising labor costs, and opportunity for performance improvements

3. The Guardian, 4. PwC, 5. Technavio, 6. The Boston Consulting Group, 7. The Boston Consulting Group

A

B

C




Robotics and AI have the ability to disrupt a broad range of sectors, particularly manufacturing,

military and defense, medicine, transportation, and agriculture.

8. CBS News, 9. Wellpoint, 10. McKinsey & Company, 11. Global Industry Analysts, Inc., 12. Bank of America Merrill Lynch Global Research

Manufacturing• In 2015, around 10% of manufacturing functions were

automated. Boston Consulting Group estimates the share

to increase to 15% by 20258

Military & Defense• The U.S. Army expects that by 2030, it could reduce

Brigade Combat Teams from 4,000 soldiers to 3,000, using

robots to maintain the unit’s effectiveness despite less

manpower9

Medicine• IBM’s Watson supercomputer has a 90% diagnostic

accuracy rate for lung cancer compared with the

average diagnostic accuracy rate of 50% for human

physicians10

Transportation• In 2030, autonomous cars could account for us to 15% of

passenger vehicles sold worldwide11

Agriculture• The global market for agriculture robots is projected to

exceed $15 billion by 202012




Industrial robotics are expected to grow at a rapid pace, receiving a strong tailwind from China,

which is looking to make up for low robotic density compared to world averages.

Source: IFR World Robotics, 2016

Growth of Industrial Robotics Worldwide & In China

Source: IFR World Robotics, 2017.

*Forecasted

15 23 2337

5769

87

115

140

170

201

0

50

100

150

200

250

20

08

20

09

20

10

20

11

20

12

20

13

20

14

20

15

20

16

20

17

*

20

18

*

20

19

*

20

20

*

Estimated Annual Supply of Industrial Robots in China (2008 – 2020)

113

60

121166 159 178

221254

294

346378

433

521

0

100

200

300

400

500

600

Estimated Annual Worldwide Supply of Industrial Robots (2008 – 2020)

tho

usa

nd

s

tho

usa

nd

s




Growth of Different Markets for Robotics

In recent times, robotics have focused on industrial and military applications, yet the consumer market

is now exhibiting the fastest growth

Source: Siemens, 2017


Lithium & Battery Tech


Lithium is the world’s lightest metal and has been dubbed “white petroleum” due to its common usage

in state-of-the-art batteries.

1. Source: Albemarle Investor Presentation, May 2017.

Approx. 60% of lithium demand has come from

industrial applications

1

Batteries could make up almost

75% of total demand by 2021

2


Lithium & Battery Tech


Historically, EVs have been limited to affluent early adopters due to higher costs than traditional

international combustion engines (ICE). Yet falling battery costs and new regulations are closing the

gap.

Battery costs have fallen substantially1 New policies are accelerating the adoption

of EVs2,3

0

200

400

600

800

1000

1200

2010 2011 2012 2013 2014 2015 2016

$ Cost/kWh Cost Parity with ICE

1. Source: McKinsey, “Electrifying Insights: How Automakers can Drive Electrified Vehicle Sales and Profitability,” Jan 2017. ICE =Internal Combustion Engines

2. 2016 car sales data. Sources: International Organization of Motor Vehicle Manufacturers (OICD), CNN 2017.3. Cities banning dirty vehicles from Green Car Reports, 2017

$ Cost / Kilowatt-hour (kWh)2019 & Beyond - China (28m cars/year2):

recently introduced a scoring method that will

phase out ICE vehicles

2025 - Norway (0.2m): new passenger cars

and vans must have zero emissions

2030 - India (3.7m): will ban the sale of new

gasoline and diesel cars

2040 - UK (3.1m): will ban the sale of new


2040 - France (2.5m): will ban the sale of new


London, Athens, Madrid, Mexico City, and Paris are seeking to ban dirty vehicles in favor or low or zero emissions cars and trucks

Aggressive fuel economy standards for ICE vehicles could raise costs relative to EVs


Converging Themes

Quote:

What Happens When Themes Converge?

23

(1) ‘From Indexes to Insights: The Rise of Thematic Investing’, McKinsey 2014.

McKinsey: “In our experience, the most attractive opportunities are found when multiple themes

converge and reinforce one another…”1

“It’s no coincidence that

consumers are becoming more

focused on health and wellness,

while at the same time peopleare living longer around the world.

Nor is it happenstance that social

media firms are reporting record

revenues, just as Millennials are

beginning to see their earnings

and consumption power

accelerate. As investors vet

various themes for possible

inclusion in a portfolio, they may

be well-served by targeting

similarly interconnected ideas.”

-Global X Research, ”Chart: What Happens When Themes Converge,” April 13, 2017

© GLOBAL X MANAGEMENT COMPANY LLC. All numbers are approximate.


Disclosures


FOR USE WITH INSTITUTIONS ONLY – NOT FOR USE WITH RETAIL INVESTORS

Investing involves risk, including the possible loss of principal. The investable universe of companies in which BOTZ may invest

may be limited. The Fund invests in securities of companies engaged in Information Technology, which can be affected by

rapid product obsolescence and intense industry competition. International investments may involve risk of capital loss from

unfavorable fluctuation in currency values, from differences in generally accepted accounting principles or from social,

economic or political instability in other nations. Emerging markets involve heightened risks related to the same factors as well

as increased volatility and lower trading volume. Narrowly focused investments may be subject to higher volatility. There are

additional risks associated with investing in lithium and the lithium mining industry. LIT is non-diversified. BOTZ & LIT are non-

diversified.

High short-term performance of the fund is unusual and investors should not expect such performance to be repeated.

Carefully consider the Funds’ investment objectives, risk factors, charges, and expenses before investing. This and additional

information can be found in the Funds’ summary or full prospectus, which may be obtained by calling 1-888-GX-FUND-1

(1.888.493.8631), or by visiting globalxfunds.com. Please read the prospectus carefully before investing.

Solactive Indexes and INDXX Indexes have been licensed by Solactive AG and Indxx respectively, for use by Global X

Management Company, LLC. Global X Funds are not sponsored, endorsed, issued, sold, or promoted by Solactive AG or

INDXX, nor do these companies make any representations regarding the advisability of investing in the Global X Funds.

Global X Management Company, LLC serves as an advisor to the Global X Funds. The Funds are distributed by SEI

Investments Distribution Co., which is not affiliated with Global X Management Company, LLC.

Shares of ETFs are bought and sold at market price (not NAV) and are not individually redeemed from the Fund. Brokerage

commissions will reduce returns. This information is not intended to be individual or personalized investment or tax advice and

should not be used for trading purposes. Please consult a financial advisor or tax professional for more information regarding

your investment and/or tax situation.

Documents

Beyond Baby Boomers - Amazon Web Services · 6/30/2018 · Outline of the 2017 Beyond Baby Boomers Survey ... Basics of the 2017 Survey of Affluent Gen X’ers & Millennials •