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Williamstown, MA, United States, 2008/08/18 - Don Dion, publisher of Fidelity Independent Adviser, announced today that iShares Dow Jones US Medical Devices (IHI) had jumped up 16 spots in ETF Momentum Tracker’s Sector Momentum Table.
Don Dion, publisher of Fidelity Independent Adviser, announced today that iShares Dow Jones US Medical Devices (IHI) had jumped up 16 spots in ETF Momentum Tracker’s Sector Momentum Table since May 20. “In the last few months of tough stock-market sledding, one of the tried-and-true axioms of investing has come to the forefront: health care is a good place to hide during bear markets,” Dion said.
IHI tracks the Dow Jones U.S. Select Medical Equipment Index, taken from the largest 2,500 U.S. stocks and weighted by market cap. The largest medical device makers are based in the U.S., but the fund gives access to global markets, including rapidly growing emerging areas. Many got a boost from the weak dollar in recent months.
“IHI’s global holdings have certainly helped to strengthen the fund’s momentum comeback,” Dion noted, “IHI top three holding Thermo Fisher Scientific, for instance, brings in more than a third of its revenues from outside the U.S. and aggressively markets its products in India and China.” Shares of IHI are up 8.4% in a month.
ETF Momentum Tracker’s fund universe includes 44 iShares sector ETFs and 34 iShares International ETFs. Over the last three months, through August 8, seven funds in the ETF Momentum Tracker universe have posted positive returns, and six of them focus on health care. “While iShares Dow Jones US Medical Devices doesn’t top that list,” Dion said, “IHI has been on a roll, with a three-month gain of 9.67% that beat the S&P 500 by more than 16 percentage points.”
In his recent profile of IHI, Dion remarked that the health care sector—while resilient on his charts—had suffered some setbacks in 2008. “The sector didn’t survive the difficult first quarter unscathed—IHI lost 11.1% year to date through March 10,” Dion said, “but it wasn’t stung as badly as the broader market—the S&P 500 fell 13.86% in that period.” IHI has gained 13.4% since March 10, and held the 10th spot on Dion’s Sector Momentum Table in the latest issue.
Dion believes that IHI could continue to have the momentum necessary to stay atop his charts in months to come. “While the medical devices industry has been a safe haven during the recent market turmoil,” Dion said, “there are strong arguments for giving its stocks a place in one’s portfolio for the longer term, including the aging population and the strength of emerging economies.”
About Fidelity Independent Adviser
ETF Momentum Tracker is a member of Fidelity Independent Adviser’s family of publications. With more than 70,000 subscribers in the United States and 29 other countries, Fidelity Independent Adviser publishes four monthly newsletters and three weekly newsletters. Its flagship publication, Fidelity Independent Adviser, has been published monthly for 11 years and reaches 40,000 subscribers.
About Don Dion
In addition to his role as publisher of Fidelity Independent Adviser, Dion is also president and founder of Dion Money Management, a fee-based investment advisory firm to affluent individuals, families and nonprofit organizations, where he is responsible for setting investment policy, creating custom portfolios and overseeing the performance of client accounts. Founded in 1996 and based in Williamstown, Massachusetts, Dion Money Management manages more than $715 million in assets for clients in 49 states and 11 countries.