TSC Ratings provides exclusive stock, ETF and mutual fund ratings and commentary based on award-winning, proprietary tools. Its "safety first" approach to investing aims to reduce risk while seeking solid outperformance on a total return basis.

Earnings season looks more like flu season as sneezing health care stocks sickened the performance of exchange-traded funds.

During the five trading days that ended Thursday, the 79 health care ETFs we track lost 2.9%, on average. The only exception was the ProShares UltraShort Health Care Fund ( RXD), which sells the sector short to generate an inverse performance. The S&P 500 Index was little-changed during the week.

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The worst-performing health care fund was the Rydex 2X S&P Select Sector Health Care ETF ( RHM), which dropped 6.8%. The fund's two largest holdings Johnson & Johnson ( JNJ) and Pfizer ( PFE) slipped 1.5% and 4.5%, respectively.

One of the fund's biggest losers was Thermo Fisher Scientific ( TMO), which gave up 13%. The company's first-quarter earnings fell 49% from a year ago, ending a nine-year streak of profit growth. Thermo Fisher also cut its 2009 earnings outlook.

Another holding, Biogen Idec ( BIIB), lost 11% over concerns that its multiple sclerosis drug Tysabri might be linked to a potentially fatal brain infection. The company recently confirmed that a sixth patient contracted the disease since the drug returned to the market in July 2006. The disclosure casts doubt over future sales of Tysabri and raises legal questions.

The ProShares Ultra Health Care Fund ( RXL) and the ProFunds Health Care UltraSector ProFund ( HCPIX) had the second- and third-biggest declines of the group. Both portfolios aim to track the daily performance of the Dow Jones U.S. Health Care Index with 200% and 150% leverage, respectively.

The worst-performing members of Dow Jones's health care index include Parexel International ( PRXL), down 30%; Pharmaceutical Product Development ( PPDI), down 21%; and Myriad Genetics ( MYGN) down 16%.

Worst Performing Health Care Funds for the Week Ending Thursday April 23
Fund Ticker Rating Fund Type 1 Week Total Return
Rydex 2X S&P Select Sector Health Care ETF RHM U ETF -6.78%
ProShares Ultra Health Care RXL D ETF -6.30%
ProFunds Health Care UltraSector ProFund HCPIX C Open-End -4.67%
ProFunds Pharmaceuticals UltraSector ProFund PHPIX C+ Open-End -4.32%
Franklin Strategic Biotechnology Discovery Fund FBDIX B+ Open-End -4.27%
Manning & Napier Fund Inc - Life Sciences Series Fund EXLSX U Open-End -4.25%
First Trust AMEX Biotechnology Index Fund FBT C- ETF -4.20%
PowerShares FTSE RAFI Health Care Sector Portfolio PRFH C ETF -4.04%
Powershares Dynamic Biotechnology & Genome Portfolio PBE C- ETF -3.80%
iShares Dow Jones US Healthcare Providers Index Fund IHF D+ ETF -3.68%
Schwab Health Care Fund SWHFX B+ Open-End -3.57%
Vanguard Health Care Fund VGHCX B+ Open-End -3.55%
Fidelity Advisor Health Care Fund FACTX B+ Open-End -3.52%
iShares Dow Jones US Medical Devices Index Fund IHI D+ ETF -3.50%
Fidelity Select Health Care Portfolio FSPHX B Open-End -3.50%
DWS Health Care Fund SCHLX B+ Open-End -3.50%
Fidelity Select Medical Equipment & Systems Portfolio FSMEX A- Open-End -3.46%
ICON Healthcare Fund ICHCX C+ Open-End -3.41%
Munder Healthcare Fund MFHCX B+ Open-End -3.32%
ProFunds Biotechnology UltraSector ProFund BIPIX B+ Open-End -3.27%
Oak Associates Funds - Live Oak Health Sciences Fund LOGSX B+ Open-End -3.19%
AIM Global Health Care Fund GGHCX B Open-End -3.16%
Rydex Series - Health Care Fund RYHIX B+ Open-End -3.16%
North Track Dow Jones US Health Care 100 Plus Fund NDJAX B+ Open-End -3.16%
Alger Health Sciences Fund AHSAX A- Open-End -3.14%
Source: Bloomberg & TheStreet.com Ratings
Kevin Baker became the senior financial analyst for TSC Ratings upon the August 2006 acquisition of Weiss Ratings by TheStreet.com, covering mutual funds. He joined the Weiss Group in 1997 as a banking and brokerage analyst. In 1999, he created the Weiss Group's first ratings to gauge the level of risk in U.S. equities. Baker received a B.S. degree in management from Rensselaer Polytechnic Institute and an M.B.A. with a finance specialization from Nova Southeastern University.

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