Healthcare ETF’s Have Jumped As Government Takeover Looks Less Likely

healthcare-etfs“With a massive government take-over of the healthcare industry looking less likely, shares of the iShares Dow Jones U.S. Healthcare Providers Index ETF (IHF) and the PowerShares Dynamic Healthcare Services ETF (PTJ) have jumped,” Don Dion Reports From The Street.

“It may not be too late to participate in the run-up. As the Senate continues to strip out provisions in the health care bill, IHF components like Wellpoint(WLP), UnitedHealth Group(UNH) and Aetna(AET) could continue to move to the upside. Rather than buying into the health care sector as a whole, purchasing shares of (IHF) or (PTJ) allows investors to target the subsector of the health care industry most threatened by proposed reform: providers,” Dion Reports.

“Looking forward, investors should consider their investment timeframe before selecting a health care provider fund. Since IHF is larger and more liquid fund, ETF investors looking to jump in and out of health care providers should stick with this fund. While PTJ hasn’t had the short-term pop that IHF has had, this fund’s more balanced portfolio should help to reduce volatility for long term investors. Since the average daily trading volume for this fund is relatively low, investors should not use PTJ for day trading,” Dion Reports.

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Here is a closer look at the two Healthcare ETF’s Below:

The investment (IHF) seeks investment results that correspond generally to the price and yield performance, before fees and expenses, of the Dow Jones U.S. Select Health Care Providers index. The fund generally invests at least 90% of assets in securities of the index and in depositary receipts representing securities of the index. It may invest the remainder of assets in securities not included in the index but which BGFA believes will help the fund track the index, and in futures contracts, options on futures contracts, options and swaps as well as cash and cash equivalents, including money market funds advised by BGFA. The fund is nondiversified.

TOP 10 HOLDINGS (IHF) ( 64.14% OF TOTAL ASSETS)  
 
Company Symbol % Assets
AETNA INC. NEW (AET) 5.43
CIGNA CP (CI) 4.17
DAVITA INC (DVA) 3.24
Express Scripts, Inc. (ESRX) 8.39
HUMANA INC (HUM) 3.56
LABORATORY CORP NEW (LH) 3.88
MEDCOHEALTH SOLUTNS (MHS) 10.72
QUEST DIAGNOSTC (DGX) 4.28
UNITEDHEALTH GROUP (UNH) 11.23
WELLPOINT INC. (WLP) 9.24

The investment (PTJ) seeks results that correspond to the price and yield performance, before fees and expenses, of the Dynamic Healthcare Services Intellidex index. The fund normally invests at least 80% of assets in common stocks of healthcare services companies. It may invest at least 90% of assets in common stocks that comprise the index. The index consists of approximately 30 U.S. healthcare services companies. These are companies that are principally engaged in the delivery, support or financing of healthcare. The fund is nondiversified.

TOP 10 HOLDINGS (PTJ) ( 45.89% OF TOTAL ASSETS)  
 
Company Symbol % Assets
AMERISOURCEBERGEN CP (ABC) 5.28
CVS CAREMARK CP (CVS) 4.85
LABORATORY CORP NEW (LH) 4.94
Lincare Holdings Inc. (LNCR) 3.3
MCKESSON CORP (MCK) 5.28
MEDCOHEALTH SOLUTNS (MHS) 5.08
QUEST DIAGNOSTC (DGX) 5.15
TENET HLTHCRE CP (THC) 2.96
UNITEDHEALTH GROUP (UNH) 4.65
WELLPOINT INC. (WLP) 4.4

Chart for iShares Dow Jones US Healthcare Provider (IHF)

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