Trend towards health care stocks?

By Jonathan Tse




Recently the stocks that have been performing well are the health care stocks. The reason behind this is the fact that many of the baby boomers are approaching the ages of 50-60 years old. This contributes to the expansion and growth of the health care industry as more elderly people need to purchase health care. It is estimated that in the next 18 years, 4 million baby boomers will reach age 60 and in 2030 the population would consist of 20% elderly people above the age 65. Many people are in conflict because they feel that there is a moral issue involved with purchasing health care stock. Once the economy recovers, some people feel that the health care industry will be one of the fastest growing sectors. Also, because the health care industry has been underperforming for so many years, the stock prices have become very cheap and are now starting to rise in price due to greater performance in recent years. Fears by people on the performance of other industries such as energy and housing have brought more investors to the health care industry, contributing to its current growth trend. Foreign companies have been participating in the recent trend of purchasing health care stock because they are looking for US stocks that are cheap and potentially profitable.

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http://money.cnn.com/2009/10/19/pf/funds/forester_health_care.fortune/index.htm?postversion=2009101913