Healthcare ETF

Healthcare is a vibrant and “hot” industry. You will not find any hospitals though. Manufacturers of pharmaceuticals dominate this healthcare ETF. I must warn you a bit about this industry as it is a market sector that has been very popular among investors during the last couple of years. 

This healthcare ETF has gained much popularity in the wake of the Biotech hype and investors have gone way ahead of earnings expectations. I must confess that the surge in prices is merited by the potential of this market sector but the risk of a bubble remains. 

If Biotech as an industry is hit, this healthcare ETF will be hit too. That being said, I am not at all pessimistic about this industry as health care is a sound market with lots of potential. By adding more and more new medicines this market sector remains vibrant. 

There is a risk however that all these new medicines cannot be afforded anymore by the public. The ceiling in the market will come from a stop in ever rising budgets for health care. 

Lyxor STOXX Europe 600 Healthcare UCITS ETF

This Lyxor Healthcare ETF is tracking the STOXX Europe 600 Healthcare Net Return index. You will find approximately 40 European top players in healthcare in this ETF.

Looking at the companies included in this healthcare ETF we find Novartis as the largest company here with a 20% share. Roche is second with a 15% share and Sanofi comes in third with a 10% share.

Of course Switzerland will come in first looking at the geographical spread with a 20% share and the UK is number 2 here with a 15% share. France has a 15% share in this healthcare ETF.

An extra call for prudence is the fact that only slightly more than 20% of the underlying stock is in Euro’s. This Lyxor Healthcare ETF is very sensitive for currency issues with the British Pound and the Swiss Franc.

So this healthcare ETF has a lot of variables build into it, in most cases a positive thing for the ETF trader who is looking for extra returns. 

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