BlackRock's New Megatrends ETF Bets on Neurology Breakthroughs

The fund offers global exposure to pure-play companies in the space.

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Reviewed by: Heather Bell
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Edited by: Heather Bell

BlackRock Inc. added a new fund to its Megatrends lineup on Friday called the iShares Neuroscience and Healthcare ETF (IBRN), making it the first pure-play product to track the neurology space specifically. Its index, the NYSE FactSet Global Neuro Biopharma and MedTech Index, covers health care companies operating in the areas of neurology pharmaceuticals and neurological devices.  

IBRN comes with an expense ratio of 0.47% and lists on the NYSE Arca.  

“We really think the next decade is going to be about breakthroughs in understanding the brain,” Jeff Spiegel, head of iShares’ U.S. megatrend, international and sector ETFs, said. “In many ways, the fundamental problem with treating the brain is historically just how little we've understood about the brain.” 

Spiegel said that the fund identifies four areas as particularly ripe for breakthroughs: mental health, neurodegenerative conditions, neurotraumatic conditions, and diagnostic tools and devices.  

IBRN’s index is global in scope and targets companies across market capitalization spectrum. Its pure-play focus requires companies derive at least half of their revenues from the neurology biopharmaceuticals or neurology devices subindustries in the FactSet Revere Business Industry Classification System, according to the fund’s prospectus. 

iShares’ Spiegel noted that although the index requires half of a company’s revenue come from one of those categories, the average for IBRN’s components is closer to 75%. He further points out that roughly half of the fund’s weight is in U.S. securities, but that Japan and Western Europe are also well-represented among the holdings.  

 

Contact Heather Bell at [email protected] 

Heather Bell is a former managing editor of etf.com. She has also held editorial positions at Dow Jones Indexes and Lehman Brothers. Bell is a graduate of Dartmouth college and resides in the Denver area with her two dogs.