Herd immunity – why now is the time to consider COVID impacted sectors

In our latest ‘Coronavirus analysis & outlook report’, we analyse whether areas of Western Europe and the United States have reached herd immunity thresholds.

Key points from our research are as follows:

• Herd immunity is likely to be achieved far sooner than the 60-70% infection rate that conventional vaccination theory suggests.
• Studies from institutions such as the University of Oxford, suggest that the extensive heterogeneous (uneven) spread of COVID-19 means that herd immunity thresholds may be achieved at an infection rate of 20% or below.
• This is supported by other studies which suggest that up to 80% of non-exposed individuals already have some form of cross-reactive immune response to COVID-19, which is likely as a result of exposure to common cold coronaviruses.
• These studies are backed up by incubation type environments – cruise ships, where only 19% of all passengers and crew on the Diamond Princess, and 30% of all Australian passengers and crew on the Ruby Princess, were infected with COVID-19. This comes despite the median age of passengers on the Diamond Princess being 69, which represents a huge skew to this older demographic versus the actual population.
• Via an extrapolation of death numbers to estimate the true level of infections across Western Europe and the United States, it appears that many regions have already, or are now reaching herd immunity thresholds. It also shows that Western Europe’s ‘2^nd wave’, is likely nowhere near as large as its initial outbreak, and is currently better described as simply a little ripple.
• This would explain the large reduction in cases and deaths in nations like Sweden, and may largely explain why the death rate across many Western European nations remains extremely far below earlier levels. It would also explain the declining cases and hospitalisations across the American North East, and American South.
• This suggests that Western Europe and the United States will likely broadly achieve herd immunity by the end of the year, and largely return to normal. COVID-19 is thus likely to be largely mitigated by the time of the US Presidential Election.

As a result of these conclusions, investors should now be paying attention to certain industries and sectors in these geographies that have been particularly impacted by COVID-19, and which would benefit from a return to normal. By gaining an early understanding of the science, and the numerous signs that point to herd immunity being achieved, there appears to be a large opportunity present for investors to exploit the current fear mentality that continues to grip the minds of many individuals worldwide.

For more information on the studies that support these conclusions, as well as a broader analysis of the real-world case studies, data used to conduct our extrapolations, and visual representations of the evolving outbreak landscape, please refer to the detailed PDF report which is available alongside this post. 

This report is the second instalment in our ongoing Coronavirus analysis & outlook series, originally published on 1 September 2020.

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