|
|
The hype about healthcare coming out of Washington never ends. Republicans keep trying (and failing) to repeal and replace Obamacare … derailed by worries about Medicaid funding and the rise in uninsured that would likely follow any rollback.
Democrats keep arguing Obamacare is a great program … despite the fact health insurance premiums are surging and more insurers are dropping out of healthcare marketplaces around the country.
As an American citizen, I certainly have my own feelings about this debate. I’m sure you do, too.
But as an investor, it’s best to keep things simple. You have to step back for a minute from the daily news cycle … ignore the ongoing healthcare hype … and focus on the phenomenal healthcare sector GAINS we’re seeing out there!
Just look at this Healthcare Sector ETFs Screener I created. It shows every ETF that’s focused on the healthcare industry and that earned at least a HOLD (“C-” or better) grade from our Weiss Ratings model. I included columns for name, ticker symbol, Rating, closing price, total assets, and year-to-date and 1-year returns.
 |
| Data Date: 7/19/2017 |
You can see that regardless of the hot air coming out of Washington, investors are flocking to a wide range of diversified healthcare ETFs, as well as those focused on sub-sectors like biotechnology, health insurance, and medical equipment. The SPDR S&P Biotech ETF (XBI, Rated “C-”) surged 32.4% year-to-date and 39.2% in the 12 months through mid-week, for instance, while the iShares U.S. Medical Devices ETF (IHI, Rated “B”) jumped 26.4% and 20.3% during those same time frames.
Some much-smaller, narrowly focused ETFs are also pouring it on. That includes the Global X Longevity Thematic ETF (LNGR, Rated “C-”), which invests in companies that “facilitate the demographic trend of longer average life spans and the aging of the global population,” and The Obesity ETF (SLIM, Rated “C”), which owns companies “that are positioned to profit from servicing the obese.” They’re up 24.5% and 22.9% YTD, respectively.
I’m not suggesting you run out and buy those last two ETFs. They have low trading volume and less than $10 million in assets between them. But you get the drift: Large, extremely liquid healthcare ETFs are trouncing the S&P 500, and so are their smaller, less-liquid brethren.
In fact, if you look at the complete list of 28 ETFs in my Screener, you’ll see that every single one is showing double-digit YTD gains. Every single one is also beating the SPDR S&P 500 ETF (SPY, Rated “B”).
So if you’re hunting for potentially profitable investments, tune out the breathless Washington hype. Focus on the longer-term trends that are favorable for healthcare companies: The aging U.S. (and developed world) population, strong earnings growth, and ongoing mergers and acquisitions. Then use our Ratings data to find the best ETFs, and put some money to work!
Until next time,
Mike
ETF Spotlight Edition, by Mike Larson, Senior Analyst Mike Larson is a Senior Analyst for Weiss Ratings. A graduate of Boston University, Mike Larson formerly worked at Bankrate.com and Bloomberg News, and is regularly featured on CNBC, CNN, Fox Business News and Bloomberg Television as well as many national radio programs. Due to the astonishing accuracy of his forecasts and warnings, Mike Larson is often quoted by the Washington Post, Chicago Tribune, As-sociated Press, Reuters, CNNMoney and many others. |
