For 2008, health funds have ranked as the top-performing equity category of mutual funds tracked by Morningstar. That may provide some comfort to investors who own health stocks for their defensive qualities -- stocks that can hold up during downturns. But compared to their showings in previous bear markets, health funds have proved disappointing lately.During the first 11 months of 2008, the average health fund lost 28.6%, outpacing the S&P 500 by about 9 percentage points, according to Morningstar. In contrast, health funds stayed in the black during the down year of 1990, gaining 17.0%, more than 20 percentage points better than the S&P. For the difficult three-year period that began in 2000, health funds returned 0.5% annually, 15 percentage points ahead of the S&P.
Health Stock Funds: Right Prescription in a Recession?
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