These ETFs Lack Health Care's Promise

The provider ETF, IHF, tilts more to insurance providers such as UnitedHealth Group(UNH Quote) and Humana(HUM Quote) than to testing companies such as Lab Corp. of America Holdings(LH Quote).

Insurance companies carry risks such as accounting that are very difficult to measure, but I am favorably disposed to the testing companies, with Quest Diagnostic(DGX Quote) held for most clients. So again, my preference here would be for a common stock -- potential 20% hit notwithstanding.

I believe health care, because of the demographic aspect, will be a very important sector over the next 10 years. While I don't think these funds are all that hot, there will be more to come. A company called Ferghana Wellspring has had funds in registration for a while now that get incredibly narrow within the sector, such as its proposed Infectious Disease fund and its Gastrointestinal/Genitourinary/Gender Health fund.

You may or may not need those funds, but the point is there will be more innovative products coming, and studying them will be worthwhile.