iShares Dow Jones US HealthcareIYH

Morningstar Rating

ETF Research and Analysis

by Robert Goldsborough

Suitability
Investors seeking broad exposure to the domestic health-care sector can consider iShares Dow Jones US Health Care Sector Index IYH. Given the sector's lack of economic sensitivity, investors seeking a defensive tilt for Read more

Bull Case

Health-care reform now has been signed into law, and many of the original bill's proposals that would have been the most deleterious to the health-care industry didn't make it into the final law.

The portfolio is filled with high-quality, wide-moat firms.

The health-care sector could enjoy a secular tailwind propelled by the aging population. Read more

Bear Case

At 0.47%, this fund's expense ratio is more than double the expense ratio of similar funds from the Vanguard and SPDR families.

The health-care sector is exposed to large systematic risks related to government policy. If the government enacts policies that reduce profitability across the health-care sector (or among drugmakers in particular), then this ETF will suffer.

The stock prices of health-care companies (drug companies in particular) can be very sensitive to the notion of increased governmental regulation of prices. Tackling the rising expense of health care is increasingly a priority for politicians. Read more