Health Care May Not Be the Stock Haven It Once Was
Calls for reform jeopardize the stability that investors crave in times of turmoil.
Even a small perceived chance of substantial policy change can roil the health care sector.
Photographer: Win McNamee/Getty Images
Recession fears and volatility are rearing their heads again, which means investors may look for safe havens.
One path traditionally leads them toward health care, which has often been relatively insulated when equities are shaky and the economy takes a downward turn. People don’t stop getting sick, and safety net programs smooth consumption. America’s aging population means that spending might even increase as other industries suffer. Hedge funds dove into the sector during the first quarter and several of them continued the trend in the second, according to 13F filings. The rotation may accelerate if markets stay rowdy.