Investing your money is a great way to increase its value over time. For first-time investors, knowing just where to put your hard-earned savings can be difficult; however, one sector that should be worth considering is the medical devices sector.
Medical devices continue to play a prominent role in every level of healthcare. The long-term life sciences market covers a wide range of health and medical instruments used in treatment, diagnosis, mitigation, and also the prevention of diseases and physical conditions.
Although this sector might look intimidating at first, here are a few tips on how to invest in medical devices as a first-time investor:
The Basics of Investing in Medical Devices
Medical device companies regularly go through extensive trials and tests for their technological products, as a way to either confirm their findings and receive any approval or discover which elements of their devices need refining before they can fully enter the market. This completion is a significant boost to a company’s share price, and also the investment opportunities of those in the market.
One thing to look out for is medical device companies showing investors that their products are ready to enter the market by having a broad demographic, or by targeting one ailment within the population in particular that they deem has an unmet medical need.
For example, Strain Measurement Devices provides sensors for the medical device market, like this custom load cell developer that can withstand the high temperature, pressure, and humidity of repeated autoclave cycles.
What are ETFs?
Exchange-traded funds (ETFs) give first-time investors a safer way to invest their savings in the market. They hold assets like stocks, bonds and commodities, and trade close to their net asset value. Since these funds are exposed to a variety of companies, any decrease in one stock won’t end up driving down returns for the ETF as a whole.
The Market Outlook
Technavio states that between 2018 and 2022, the global medical devices market is projected to grow at a compound annual growth rate (CAGR) of 5%. The reason for this growth will be an increase in diseases, in particular neurological, cardiovascular, orthopedic, and respiratory diseases. These diseases are on the rise as the global population continues to live longer than any previous generation before.
In fact, the United Nations states that population aging is likely to become one of the most significant social transformations in the 21st century, impacting nearly all sectors of society. The UN states that by 2050, 16% of the global population will be over age 65. This is a significant increase from the 9% figure in 2019.
For you to be able to invest wisely, you first need to have a plan. Good investing means thinking through every decision carefully, including the risks associated with the investment, the current condition of the market, and, most importantly, what you wish to achieve from the investment.
However, with the future growth of the medical technology market anticipated to be in the billions, there has never been a better time than now to start investing in medical devices.