HQH - XLV: Healthcare Is Ripe For Buying Despite Patent Cliff

2024-05-16 00:20:56 ET

Summary

• The healthcare sector is one that exhibits "inelastic demand" and has the unique advantage of being essential to peoples' lives.
• Healthcare's valuation has been stunted by risks such as the "patent cliff" in the next few years, but its valuation is now very attractive.
• XLV still carries risks, which are discussed in this article, but ultimately is a "buy" based on macro and fundamental factors.

Introduction

Recently, I published an article where I briefly discussed the healthcare sector and its driving investment theses. After that, I've felt myself wanting to dive deeper into healthcare specifically. This has led me to the SPDR Healthcare Sector ETF ( XLV ), which holds the healthcare components of the S&P 500....

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