“Large cap health care companies are superior goods,” says Paul MacDonald, chief investment officer and portfolio manager at Harvest Portfolios Group Ltd. in Oakville, Ont. “We need them all the time. They’re not immune to recession, but they’re very much insulated from it.”, the largest Canadian health care exchange-traded fund . It has $954-million in assets under management and holds 20 of the largest global health care companies.
Nick Kalivas, head of factor and core equity strategy, ETFs at Invesco Ltd. in Chicago, says health care offers defensive growth, much like consumer staples companies that sell groceries and household goods and many real estate investment trusts. Mr. MacDonald and Mr. Kalivas both say that the health care sector has several favourable secular themes over the medium to longer term. The first is aging populations in developed markets. An older demographic spends more money on health, including drugs, medical supplies and surgical procedures. The second is technological and product innovation.
Privatization coming soon.