Citi Global Wealth UNSToPPABLe TreNDS | | 81 Investments wHAT To Do Now? FiGUre 3: PHArMACeUTiCALS BeAT BioTeCH iN 2022’S ToUGH CoNDiTioNS We believe that demand for healthcare will likely grow faster than the economy 675 over time. And we see a compelling case Russell 3000 Pharma Russell 3000 Biotech for portfolio exposure to this source 375 of long-term growth. Healthcare is the least cyclical of all economic sectors: 575 the least tied to economic performance. Major pharmaceuticals firms have 325 routinely raised their dividends through turbulent times. a 475 h m c Amid 2022’s difficult conditions, for r 275 e a t o example, large-cap pharmaceuticals h i P B showed comparative resilience, falling 0 0 by less than broad market indices. 0 375 0 0 225 0 They may continue to perform this role 3 3 l l in 2023, should volatility persist. By l l e e s s contrast, life sciences and small-cap s s u u indices underperformed – FIGURE 3 – R 275 R but may potentially perform strongly 175 once the Fed ceases raising and then starts cutting interest rates. Further selloffs in the meantime may present us 125 175 with opportunities to build longer term positions in innovative segments such as life sciences, medical technology and biotech. 75 75 We see many possibilities for gaining '10 '11 '12 '13 '14 '15 '16 '17 '18 '19 '20 '21 '22 '23 exposure to this vital industry for the years ahead, including strategies from Source: Haver, as of 14 Oct 2022. specialist managers and capital markets Chart shows the performance since 2010 of the Russell 3000 Pharmaceutical and Biotech sub-indices, noting the former’s outperformance of the strategies for suitable investors. With latter in 2022. Past performance does not guarantee future results. Investors cannot invest in an index. All forecasts are expressions of opinion, the unstoppable trends of aging and the are subject to change without notice and are not intended to be a guarantee of future events. rise of Asia’s middle class continuing, the prognosis for healthcare looks positive. Is your portfolio taking the prescription?