@catch22, and others;
I previously commented that the healthcare component comprised 12% of the S&P500 index. That is confirmed here, http://www.bespokeinvest.com/thinkbig/2013/3/11/historical-sp-500-sector-weightings.html although the data is two years old. I don't think there has been that much of a change.
As for returns, the healthcare sector within the index has returned 25% YTD. This from the Yardeni research. http://www.yardeni.com/pub/PEACOCKPERF.pdf
So anyone holding the SP500 index has a 12% exposure to healthcare already. The missing part of that is biotech. There might be a bit of that in the index but I think it is mostly comprised of big pharma etc. Is it still a good idea to throw an additional 5% of the portfolio into healthcare exclusively? I think so and with that you get the biotech components which are the big returners this year and I think for the future. As I have said before, I like "future stocks". There is also another consideration in this as companies like GE have a healthcare component within them but they are classified differently. Toshiba is another company like that as well as Siemens. The latter two are not SP500 companies but I added them for examples. There may be others.
Edit: Look at Fig.10 of the Yardeni link that breaks down the healthcare sector further into subsections and biotech is the leader at 35% return YTD. The others are not chopped liver either.
The bigger question might be at what point does an investor have too much in healthcare?

Hi @LLJB
You noted: "I have a question for you related to your points here and in another post about not investing less than 5% in "whatever" because it takes that to make any difference in your portfolio. I agree with you but I also realize it can depend on how you define your "whatevers". For instance, my position in PRHSX is 1% of my portfolio but I could count it as healthcare or I could count it as large cap growth or both. Either way it doesn't make or break the 5% rule in this case, but when you think about your 5% threshold, do you double count? And if not, how do you decide which "whatever" things get allocated to?"
>>>What I posted in another thread: Our house remains U.S. centric in the equity area, gathering whatever international exposure from the fund holdings. The only direct exception being, GPROX; at this time.
A serious consideration going forward is to maintain VTI / ITOT or similar holding for 40% U.S. equity exposure and PIMIX (our largest bond holding) for bond exposure, also at 40%.
The remaining 20% would be allocated to "other", as determined by market observations. Currently, this would be the healthcare sector. Any of these holdings would be subject to change, not unlike June of 2008, as previously noted. None of the 20% floater money would hold less than 5% in any one area; as too little forward appreciation could likely be the result. This could mean, however; that more than one fund could result in a given market sector.....i.e.; energy; to provide the 5%.
Regarding the 5% consideration for the "whatever" money.
The 5% minimum I personally use is for investments I consider favorable for my risk/reward tolerance; and that present what appears to have a decent capital appreciation potential.
This is relative to what I noted above; with maintaining 40% in each for VTI and PIMIX. Healthcare holdings are about 14% of VTI. This would meet my needs, if I wanted at least 5% in healthcare (14% of 40% of the total portfolio).
Obviously, 40% each to VTI and PIMIX indicates a major part of a preference for an overall portfolio, and is U.S. centered with the exception of non-U.S. companies within VTI, or more so, the earnings of U.S. companies generated outside of the country. So, one could weakly argue some foreign exposure.
Now, what to do with the other 20%? Cash at this house has been some form of bond holding. If we want to buy something else, we always have to sell some of a bond fund for the transaction (at least as of today :) ).
This is the part that generally has the consideration for the 5% to make any difference; for the investment to be worthwhile to the overall portfolio. Usually the 5% is purchased at one time. Although, I think it is fine to average into a holding, too. But, I if averaged into a particular holding; it would likely be within a one month time frame.
Today, with 80% of a portfolio in the above two holdings; this would be the mix for the remaining 20% if split 4 ways: GPROX (although now closed), FRIFX (conservative, decent performing real estate), GASFX (utiliy/energy) and FSPHX. Or the whole 20% into FRIFX , GASFX or FSPHX.
This is obviously a lot of fiddling around with a portfolio. With enough choices, one may also consider 20% into 5 balanced/conservative allocation/moderate allocation funds or etfs to spread manager risk. I note this as one balanced fund with a very nice return record for several years is in the tank this year....... VILLX is running a negative return YTD. Lots of folks with this fund who are not happy. We do not hold this fund, thankfully.
>>>You also noted: "For instance, my position in PRHSX is 1% of my portfolio but I could count it as healthcare or I could count it as large cap growth or both. Either way it doesn't make or break the 5% rule in this case, but when you think about your 5% threshold, do you double count?"
PRHSX is a sector fund and that is the only way I view such a holding. It is a special consideration; separate from a LC, MC, SC, growth or value equity. Such a fund could be a combination with tight restrictions from managers; such as a small cap healthcare fund, but it is still a dedicated sector.
>>>Also noted: " but when you think about your 5% threshold, do you double count?"
I will presume you mean overlap within holdings to form the 5% threshold. Yes.
I write singular here; but the portfolio is a household portfolio. At one time we both had several 401k/403b from investment vendor changes over the years. Early in 2009 we wanted a high percentage exposure to the HY bond area. We had about 45% of our portfolio invested in this area at one time, split among several investment houses within the retirement accounts. The same would apply to 1% from here and another 2% from somewhere else to meet the 5%.
I have not checked, but I suspect many broadbased equity funds have fairly high percentages of healthcare holdings. Depending upon your funds, you may have a fairly high overall percentage of healthcare.
In theory for some, is that diversification helps ease the pain when the markets are "mad". One could suppose finding 20 investment areas and givng 5% to each. I'm not convinced this method is of value.
I probably missed something with this long write; which was not intended to be this chatty.
Like me know about clarity; as it is too late at night for me, today.
Regards,
Catch

I started there (Vanguard) and I will hold their BEST till the end, with about 50% of all my money, and NO I don't hold Index funds, but I used to.......... graduated?

Hi JoJo,
Cresci did a very fine job at HLMRX, so JOSAX looks good to me. I would likely target JOSMX (ER 1.24 vs. 1.49 for JOSAX), which is apparently available in Fidelity retirement accounts for a $500 minimum + TF according to a test trade I just made. Another fund to consider, which has a value bias, is BISMX, and this fund is available at Scottrade for a $2500 minimum in both types of account with a TF.
Kevin

Hi @catch22, I agree!! I have PRHSX in an account at E*TRADE where its NTF. I was just trying to offer some thoughts related to the idea that the fund was showing as closed.
I have a question for you related to your points here and in another post about not investing less than 5% in "whatever" because it takes that to make any difference in your portfolio. I agree with you but I also realize it can depend on how you define your "whatevers". For instance, my position in PRHSX is 1% of my portfolio but I could count it as healthcare or I could count it as large cap growth or both. Either way it doesn't make or break the 5% rule in this case, but when you think about your 5% threshold, do you double count? And if not, how do you decide which "whatever" things get allocated to? Thanks for your thoughts!

Howdy @LLJB
While PRHSX does appear to "allow" a buy internally at Fido, personally; I don't find a need to purchase ($50 fee) this fund versus FSPHX.
My 2 cents.
Take care,
Catch

I would have thought that was implicit in the discussion of low volatility funds. Dividend paying stocks tend to have lower volatility because of their moderately assured income stream - the same stream that makes them susceptible to interest rate risk, as discussed in the article.
Here are a couple of WSJ articles on this point:
http://www.google.com/search?q=high+hopes+for+'low+volatility'+funds
"Many low-volatility stocks pay high dividends. .. 'The PowerShares fund should capture the low-volatility effect better, [] but the flip side to that is that you're taking on more sector risk.' That's because the PowerShares fund tracks an index composed of the least volatile stocks in the S&P 500, and becomes heavily weighted toward sectors like utilities (recently around 25% of the index, compared with about 3% for the S&P 500)."
http://www.google.com/search?q=beware+'low+volatility'+ETFs (okay, technically this one's from Barron's)
"A BETTER BET: dividend-growth stocks. They're steady hands, with more attractive valuations and less interest-rate sensitivity. ... VIG ... SCHD"

@mcmarasco: Here's what Nellie Huany at Kiplinger had to say about health care funds back in September.
A revolution is under way in health care, and it’s not too late to cash in. Scientific advances are changing the way drugs are developed and creating a torrent of new treatments. By making insurance available to millions who previously couldn’t buy it, Obamacare is fueling demand for health care products and services. And, oh, by the way, we’re not getting any younger.
Put it all together, and this colossal sector is likely to keep growing faster than the overall economy. Health care spending in the U.S.—some $3 trillion a year—accounts for 18% of gross domestic product. The government predicts that the figure will rise by an average of 5.8% annually over the next eight years, slightly faster than the growth of the overall economy. That’s reason enough to make a long-term commitment to health stocks, but it’s not the only one. Three trends are dramatically changing the health care system, creating plenty of opportunities for investors.
Regards,
Ted

I suspect showing PRHSX as closed is a mistake because there's no general indication that its closed and I'm able to process a buy past where I would normally be told I couldn't buy if its closed in non-Fidelity accounts. In fact, Fidelity doesn't stop me either although I don't have any excess cash in the account so I can only get to the point where it tells me I don't have enough money to make the initial investment minimum.
As for an REIT, I have never researched it in depth, but HCP is 12% below M*'s fair value estimate and paying a little less than 5% yield.

Hi @mcmarasco
You noted: "Does anybody have any thoughts on Blackrock Healthcare (SHSAX) "Load Waived" at FIDO or Vanguard Healthcare (VGHCX) also at FIDO and GOLD rated by M*?
I like the idea a pairing with another fund such as FBIOX, any suggestions or comments?
FIDO shows PRHSX (TROWE) as "closed" to new investors even though it is "open" at TROWE. Any insight or suggestions?"
>>>For broadbased healthcare, I do not find an advantage to holding Vanguard or others when compared to FSPHX. The performance is similar looking backwards. There is and will be variances over other time frames depending on manager actions. As you are already "inside" of Fido with your account, I personally don't find a need to move outside of Fido offerings. I have not checked for overlap; but you could also consider a more directed play towards pharma with FPHAX or directed towards the delivery side of medical services with FSHCX.
With the exception of FBIOX, of which; FSPHX has a chunk of this action, over a 5 year time frame, FSPHX is a most suitable and able performing healthcare fund when compared to all other active managed funds.
We've considered mix and match with the several Fido medical area funds; but have remained with our monies in FSPHX.
Fido also has an etf (can't recall the ticker), either via I-shares or Fido for healthcare.
Lastly, I personally would not invest any less than 5% of a total portfolio in a given sector, in order to provide enough momentum to a portfolio. 'Course 5% can also go against the portfolio, too. :)
As others have also noted; your other equity fund holdings may alread have your portfolio at 5% of total holdings in healthcare. Many broadbased equity funds owe their YTD gains to healthcare holdings. I personally find no problem with adding to this sector, as dedicated holdings.
As always, just suggestions; eh?
Take care,
Catch

Hi rjb112 and others,
Today is Sunday November 30th around 8:45 AM EST as I write.
I composed an email and sent it to Elizabeth Weilburg of Morningstar "M*" and advised her of continued pricing concerns that had been expressed earlier to M*. In my email, I provided the link to the MFO site thread that would provide current details and documentation on this continued issue of slow pricing of certain mutual funds.
In addition, I'd like to thank rjb112 for providing the supporting screen shots which provided visuals in support of my statement. It is appreciated.
Sould I receive a response to my email I let all know.
Old_Skeet
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Additional Note: It is now about 9:40 AM EST on Sunday November 30th as I write this note; and, it seems the visuals provided by rjb112 that I referenced in my email to Ms. Weilburg and in the above comment, for some unknown reason, to me, have now been removed.
Leaves me to wonder why one would do this?
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Interestingly, it is now about 10:20 AM EST Sunday and the visuals have now returned. Hopefully, they will remain.
Old_Skeet

@linter: Your combination provides the following exposure: 50% HC, 22% Tech, and 13% Industrials. You may want to consider an equal mix of PRHSX and POAGX, which would be my preference. But if you want a higher octane, then you may consider a mix of PRHSX 5%, FBIOX 5% and POAGX 10%. In our portfolio, we own 10% positions in both PRHSX and POAGX.
Kevin

Sorry for being a dissenter, but does anybody really need an EM HC fund -- translation: regional, sector ?? Smells like too much slicing and dicing to me. If this is a slice-dice need, then I would focus less on where a stock is domiciled and more on where a stock derives its revenue, and one may want to consider an ETF like PPH, which holds significant positions in stocks that derive appreciable sales from emerging market countries as detailed here:
http://www.fool.com/investing/general/2014/03/16/5-big-pharma-stocks-with-the-strongest-ties-to-eme.aspx
Kevin

i have 5% in PRHSX and 10% in POAGX. besides those two and all the similar funds, are there any other ways to buy healthcare, just to diversify a little w/ in the sector? what about healthcare REITs? any thoughts on those? or maybe GILD, to go purer and take a flier on one of the biotech powerhouses?

@mcmarasco, If you own the S&P 500, you already have about 12% of your assets in healthcare. Putting 5% into a pure healthcare play is not a bad idea. Biotech has a big future but it will be volatile.
If you are worried about the bull getting long in the tooth, you could DCA into healthcare and biotech and/or wait for a pullback to add funds.

Have a number of individual names and both CEFs and a mutual fund. While there may be volatility in the short/mid-term, take a look at the performance of some of the major biotechs, which actually did well in 2008. I think you have a combination with these names of growth and some degree of defensiveness. Plus, what Tampabay said.
Also, there is an investor day webcast on the Tekla website (HQH, HQL, TQH) that lasts about 3.5 hours. I thought it was a fascinating look at the industry - 3.5 hours may sound like a lot, but I thought it passed by rather quickly, with a panel discussion, chat from the fund managers and guest speakers.

Mac, ask yourself, "Self do you see Healthcare costs going down? do you think facilities and drug/medical companies will stop making money", see more or less users of healthcare in the future? You have answered yourself, 5% is nothing as a sector play....

I have been contemplating putting about 5% of my portfolio into this arena. But I'm not sure if that is a wise move right now. Would I be "late to the party"?
I have been hearing and reading that this is the place to be but the returns over the last few years (and YTD) have been unbelievable. I don't expect that to continue, but is there still room for Healthcare to prosper going forward?? What about the Biotech arena? I know it is much more volatile than the broader "Healthcare" sector; but is it worth it???
I can take some volatility, so that is not a major concern. Furthermore, this industry also seems to be a nice diversifier, little correlation to the stock market as a whole!
Any and all thoughts, comments, ideas and suggestions welcome!!!
Thank you, Matt

Hi Carefree,
David Iben is a very smart investor, but that doesn't mean that you need to give him your money to manage. He is obviously taking concentrated bets on beaten down sectors that continue to be beaten down more (aka, value trap). And the chart for his fund -- using the 20/50/100EMAs -- looks ugly and is not improving. I would definitely consider this fund a sell and avoid. If one wants to bottom fish and has extreme patience and tolerance for pain, then I would take a look at RSX. But otherwise, I would recommend looking at more attractive global equity funds like DODWX, THOIX and VMVFX/VMNVX.
Kevin

It is now Saturday November 29th at about 9:00 AM EST as I write. I have two funds (JCRAX & SGGDX) that are currently reflecting Wednesday November 26, 2014 nav end of day pricing in Morningstar's fund quote sheet. This carries over into their portfolio manager system.
Seems Morningstar still have issues as Yahoo Finance and the respective fund families are reporting the correct nav end of day pricing as of Friday November 28th.
Old_Skeet

@Old_Skeet: In case you want to call them and show the documentation: