Health Care vs Health Index

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cliff
Posts: 64
Joined: Sun Mar 04, 2007 3:21 pm

Health Care vs Health Index

Post by cliff » Fri Jan 04, 2013 9:15 am

I am a very long time holder of Health Care in an IRA and am very happy with the returns, until recently. Now when I compare it with the Vanguard Health Index I am questioning if it is not time for a change. Health Care (Health Care index) 1, 3 and five year returns as compared with category: 84 (54), 50 (36),38 (49). With the manager retiring and expenses .13 for the index and .30 for health care fund I am questioning whether it is time to change. I am not convinced it will make a huge difference but still seems like a logical move. I am a seasoned investor and certainly understand there is no way to predict the future but am curious as to others opinions.

Thanks

hlfo718
Posts: 756
Joined: Wed Dec 01, 2010 9:17 am
Location: NYC

Re: Health Care vs Health Index

Post by hlfo718 » Fri Jan 04, 2013 10:45 am

The healthcare fund is run conservatively compared to peers hence when there is a big up market it will lag, like 2012. But look at 2002 and 2008, it loss less than peers. I also like the low turnover, around 8%. I have a small position in the fund as well as the index ETF. I like both and since they are small positions, I don't freak out when they underperform.

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SpringMan
Posts: 5304
Joined: Wed Mar 21, 2007 11:32 am
Location: Michigan

Re: Health Care vs Health Index

Post by SpringMan » Fri Jan 04, 2013 12:04 pm

The Vanguard Health Care Index fund is primarily US companies. The Vanguard Health Care actively managed fund has both US and foreign companies. The same is true with Vanguard's Energy Index and their actively managed Energy fund. Despite that they do seem to have a high degree of correlation in both cases.
Best Wishes, SpringMan

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