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Why I love investing in health care, not biotech

I prefer to be as sector agnostic as possible when investing, but when pressed, I admit that healthcare is one of my preferred industries to invest in.  While sensitive to regulation and high professional service fees, healthcare is something humans have always needed, are likely to always need, which technology has made enormously higher in quality, and can be easily understood as a profitable business.  Within healthcare, there are many different sub-sectors including those who provide healthcare, the hospital REITs which own and rent out the buildings in which that care is provided, the makers of healthcare equipment,  pharmaceutical companies that make drugs, and biotech companies who research and develop those drugs and technologies.  It should come as know surprise to know who know my preference for investing in value, quality businesses that are firmly profitable, over more speculative technology stocks, that I prefer the earlier sub-sectors on that list to later ones.

Today’s sector chart shows the past 34 years’ performance of two sector funds vs the S&P 500 index: the Vanguard Healthcare vs Fidelity Select Biotech funds.

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