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Anyone own or have any thoughts on this fund? Eventide Gildead Fund (ETGLX). It has a fantastic, YTD, 1, 3 and 5 year return. Small fund with only $75M. Just stumbled upon it and wanted some opinions.
Me too. I was amazed by the return and couldn't resist it due to fund manager's credentials: double majors for undergrad from Cal. Tech, double majors for master degree from MIT , PhD from Harvard and medical school at Harvard. Went in 7/1 and been up everyday. It is now up 6%.
Seems to be heavily invested in biotech as you would expect given the manager's training. Biotech has been on a tear lately. Wonder how it would weather a downturn?
I work in the healthcare sector, and with an aging population and Obamacare, there will be more, not less, healthcare spending going forward. So I am extremely bullish on this sector. Both of these Eventide funds look solid for a play on healthcare, but be prepared for volatility. Despite the recent manager change, I am sticking with PRHSX, in which we have an 8.5% position. PHSZX would be my first choice, but it is closed to new investors.
A few questions directed towards your experience and knowledge in the healthcare sector:
1) What do you think of the performance of the new manager at PRHSX? If it us too early to tell, what kind of time horizon would you give him?
2) How important is it for a healthcare fund to be nimble? Would it be correct to say prices of healthcare (particularly biotech) stocks are relatively more event-driven (drug approvals, competitor drug approvals, government policy)?
3) Regarding the aging population and Obamacare, what do you see happening with the companies in the diabetes treatment sector -- Novo Nordisk, DaVita and Fresenius?
1. PRHSX has been tracking with the average HC fund over the past 1M, 3M, YTD, and 1-YR. So the fund has been average over this time period with the now-departed Kris Jenner and the new manager. I have found that TRP is a solid organization with a deep bench of talent, so I have confidence that this fund will deliver going forward with better than average risk control. Bottom line: I like this sector, and this fund is a reasonable way to play it going forward. Of course I will continue to track this fund like I do all of my funds (11), by following the 20/50EMAs, 50/100/200SMAs.
2. I would be careful trying to play a sector (e.g., biotech) within a sector (HC). Something like BBH would be fine, as long as you can tolerate the volatility and you have a defined exit plan. I prefer to just pick a solid diversified HC fund/ETF and be done with it. There is a lot of money going into biotech research, and yes, all the factors you list are important. Of course I prefer HC funds with low AUM, but I don't think PRHSX is too large.
3. I am bullish on anything related to diabetes, as the prevalence of this disease is projected to grow 165% by 2050, and spending on treatment and research will increase dramatically. The prevalence of obesity, a major risk factor, continues to grow, especially among children and adolescents. I agree with what a nutritional expert stated, "Americans want to look healthy but don't want to be healthy."
Eventide’s investment philosophy is rooted in the biblical understanding that God’s great intent for business is that it serve and, in turn, bless humankind . . . and that companies that prosper best, and sustainably, are the ones who do this especially well.…
If they are heavily invested in Healthcare and Biotech, at least we know God is progressive, and that may be a good thing.
Thanks, I am also a physician. I agree the healthcare field has excellent long term potential due to the aging population. My main concern is the biotech space that I equate with the tech stocks of the late 90's. They have good long term fundamentals but will rise and fall as investment darlings of the momentum chasing crowd. Periods of outperformance will be followed by sudden collapses in investor sentiment.
Also, left to their own underlying fundamentals, healthcare stocks should do well as a non-cyclical demographic play. Picking winners and losers, though. may be difficult. So far this fund's managers have done an outstanding job. But can they continue? Their track record is fairly short.
Another factor is Government policies. Look at what they did with their surtax on medical equipment manufactures. Talk about an area with robust growth potential due to an aging population, they were slammed by a ridiculous tax on their products including joint replacement products and pacemakers. Only now are they trying to repeal this tax (http://www.forbes.com/sites/deanzerbe/2013/04/09/the-medical-device-tax-stop-dreaming-and-start-planning/).
All in all, I agree with your sentiment on the healthcare field and second your comment regarding volatility.
I just test traded for the institutional classes of the Eventide funds, ETIHX and ETILX, at Scottrade, Firstrade, TDAmeritrade, Wellstrade and Fidelity, and the only access below the prospectus minimums appears to be at Fidelity, where the minimum for ETIHX in retirement accounts appears to be $2500 with a TF.
Reply to @Joe: Actually in their SAI, it says lot of shares through Schwab. Looks like it is available, just not NTF. Incidently "Da Great Doctor" has less than $10K invested. While the younger guy has less than $500K. Makes you wonder who is actually running the fund.
The health care problem that is a bigger issue than the device tax is Medicare funding. With aging demographics, the Medicare runaway train can not continue unabated. The WSJ has been highlighting Medicate fraud for the last 5 years, but is forbidden by AMA lawsuit from 1977 from disclosing doctors names from the Medicare database who are complete outliers in billings.
“Spinal implants became big profit generators for device makers. The screws used to drill into bone, known as pedicle screws, sell for $1,000 to $2,000 apiece but cost less than $100 to make.” My uninformed impression is that the spinal fusion surgeries are in very large minority of cases not better then faith healing, acupuncture. If Medicare pay for this type of abnormal billing, then what the heck are they doing to control costs? Nothing good.
Living in Southern CA, I am familiar with the biotech industry. I have met someone who procures manufacture of medical devices from Mexico for ostensibly the Medicate market for a very health premium. So the device tax of less than 3% is not going to bankrupt anyone or stop any surgeries.
We can have better medical outcomes by getting rid of insurance except for catastrophic care. There is no price competition in medical care (no quality of care comparison either). If you have to ask the price you can’t afford is definitely the prevailing wisdom. What if there were prices and you could compare prices? Wouldn’t prices come down?? If people clip coupons and buy fluff from Groupon , could they not shop for medical care??
We also need to make sure athletically challenged guys like me spend less time debating smarter guys and spend more time in the gym. (I did lose 3 lbs last month, only 25 to go)
I want all these companies to thrive because I have owned Vanguard Health care for nearly 20 years. Best fund ever, high return low(er) risk, even after my pal Gus retired.
BTW, I think Eventide funds are high beta that will be great to own after a big correction in its sector, not a buy and forget.
Reply to @VintageFreak: Well the double Dr. probably had to use the funds to buy his Gulfstream 5 so he can personally pilot it to see his five close friends on 5 continents in his free time.
Dr Hussman is also brilliant scholar but not necessarily the best investor.
Reply to @Joe: Wait, so these guy are pumping Drucker and Porter and mocking patron saint of capitalism - the beloved Chicago school Milton philosophy that presaged the 2008 Armageddon? Those sad socialists.
"We can have better medical outcomes by getting rid of insurance except for catastrophic care."
Which insurance? Company, government sponsored or ?
I'm attempting to determine what type of medical insurance I would eliminate for myself, our family or my parents to the point of having only catastrophic care coverage.
I'm imagining a sinus infection, untreated; becoming more involved in the lungs, leading to treatment at some point as a major complication for the entire body. This is only the medical portion of the situation, and doesn't factor loss of ability for a time period for productive work, running a household and/or taking care of young children dependent upon a healthy parent, etc.
Reply to @equalizer: I think you are right-on with holding insurance for catastrophic care or in other words, having high deductible policies.
I switched to a CDHP plan about 3 years ago. I was nervous and hesitant at the time, but it's been a great way to go. I fund an HSA account with the money I saved by not paying for the higher HMO or PPO plans. So at the end of the year I've put money in the bank, tax free, instead of throwing it away on high premiums. If this was the way health care worked for everyone, people would look for value and competition would lower health care prices.
To Catch22's point, why would you not take care of that sinus infection before it got more serious? Why would you leave it untreated? You don't have to pay exorbitant monthly premiums to take care of that sinus infection. For most healthy people, paying out of pocket when needed and having that safe guard for catastrophic events is still much cheaper than paying a high monthly premium every month that you may or may not use. At least that has been the case for my wife and I.
To Catch22's point, why would you not take care of that sinus infection before it got more serious? Why would you leave it untreated?
I guess I should have prefaced; that the infection was attempted to be treated with sinus passage flushes with a saline solution and any other treatment that could be discovered on the internet. Infection is infection; and not always a condition that one may resolve with home remedies, etc.
Are there not any medical conditions not treatable by an individual; that must wait until the issue becomes very serious in order to quality for a catastrophic circumstance or insurance coverage?
I must state that the "upside" for medical non-treatment (resulting in death, of course) to many above the age of 65, including their parents, is that the burden to Medicare, Medicaid and Social Security would be greatly reduced and have a most positive affect upon the debt of the U.S. A likely downside, however; is a nasty impact upon the housing market and related business (Lowe's, Home Depot). Not sure how to deal with the younger crowd and their medical treatments. Few things are simple, eh?
Reply to @catch22: Hi Catch. Gee, I'm not advocating non-treatment or self treatment at all. If I had that sinus infection, I would be at my doctor's office getting antibiotics. I would have to pay for the visit and the drugs out of pocket. Out of pocket actually means out of my HSA savings account that holds tax free money. That money is in my HSA because I put it in savings instead of giving it upfront to the insurance company. If, catastrophically, my medical out of pocket expenses reached $4000, my CDHP plan starts to provide the same co-pays as a much more expensive HMO or PPO policy.
My argument and I think 'equalizers' mention of catastrophic insurance is that paying the health care bill yourself instead of the insurance company forking over the money gives the consumer an appreciation of costs. That would lead to price competition between health providers. Believe me, if consumers started looking for the best price, health providers would find a way to compete. I think that was the original point.
Reply to @VintageFreak: Would that "progressive God" be the same God who created a planet where almost everything on it eats all of the other stuff on it?
Comments
I work in the healthcare sector, and with an aging population and Obamacare, there will be more, not less, healthcare spending going forward. So I am extremely bullish on this sector. Both of these Eventide funds look solid for a play on healthcare, but be prepared for volatility. Despite the recent manager change, I am sticking with PRHSX, in which we have an 8.5% position. PHSZX would be my first choice, but it is closed to new investors.
Kevin
Kevin,
A few questions directed towards your experience and knowledge in the healthcare sector:
1) What do you think of the performance of the new manager at PRHSX? If it us too early to tell, what kind of time horizon would you give him?
2) How important is it for a healthcare fund to be nimble? Would it be correct to say prices of healthcare (particularly biotech) stocks are relatively more event-driven (drug approvals, competitor drug approvals, government policy)?
3) Regarding the aging population and Obamacare, what do you see happening with the companies in the diabetes treatment sector -- Novo Nordisk, DaVita and Fresenius?
Thanks in advance,
BWG
Hi BWG,
1. PRHSX has been tracking with the average HC fund over the past 1M, 3M, YTD, and 1-YR. So the fund has been average over this time period with the now-departed Kris Jenner and the new manager. I have found that TRP is a solid organization with a deep bench of talent, so I have confidence that this fund will deliver going forward with better than average risk control. Bottom line: I like this sector, and this fund is a reasonable way to play it going forward. Of course I will continue to track this fund like I do all of my funds (11), by following the 20/50EMAs, 50/100/200SMAs.
2. I would be careful trying to play a sector (e.g., biotech) within a sector (HC). Something like BBH would be fine, as long as you can tolerate the volatility and you have a defined exit plan. I prefer to just pick a solid diversified HC fund/ETF and be done with it. There is a lot of money going into biotech research, and yes, all the factors you list are important. Of course I prefer HC funds with low AUM, but I don't think PRHSX is too large.
3. I am bullish on anything related to diabetes, as the prevalence of this disease is projected to grow 165% by 2050, and spending on treatment and research will increase dramatically. The prevalence of obesity, a major risk factor, continues to grow, especially among children and adolescents. I agree with what a nutritional expert stated, "Americans want to look healthy but don't want to be healthy."
Kevin
Eventide’s investment philosophy is rooted in the biblical understanding that God’s great intent for business is that it serve and, in turn, bless humankind . . . and that companies that prosper best, and sustainably, are the ones who do this especially well.…
If they are heavily invested in Healthcare and Biotech, at least we know God is progressive, and that may be a good thing.
Kevin
Thanks, I am also a physician. I agree the healthcare field has excellent long term potential due to the aging population. My main concern is the biotech space that I equate with the tech stocks of the late 90's. They have good long term fundamentals but will rise and fall as investment darlings of the momentum chasing crowd. Periods of outperformance will be followed by sudden collapses in investor sentiment.
Also, left to their own underlying fundamentals, healthcare stocks should do well as a non-cyclical demographic play. Picking winners and losers, though. may be difficult. So far this fund's managers have done an outstanding job. But can they continue? Their track record is fairly short.
Another factor is Government policies. Look at what they did with their surtax on medical equipment manufactures. Talk about an area with robust growth potential due to an aging population, they were slammed by a ridiculous tax on their products including joint replacement products and pacemakers. Only now are they trying to repeal this tax (http://www.forbes.com/sites/deanzerbe/2013/04/09/the-medical-device-tax-stop-dreaming-and-start-planning/).
All in all, I agree with your sentiment on the healthcare field and second your comment regarding volatility.
Jim
Kevin
Dr. JimJ,
The health care problem that is a bigger issue than the device tax is Medicare funding. With aging demographics, the Medicare runaway train can not continue unabated. The WSJ has been highlighting Medicate fraud for the last 5 years, but is forbidden by AMA lawsuit from 1977 from disclosing doctors names from the Medicare database who are complete outliers in billings.
“Spinal implants became big profit generators for device makers. The screws used to drill into bone, known as pedicle screws, sell for $1,000 to $2,000 apiece but cost less than $100 to make.” My uninformed impression is that the spinal fusion surgeries are in very large minority of cases not better then faith healing, acupuncture. If Medicare pay for this type of abnormal billing, then what the heck are they doing to control costs? Nothing good.
Living in Southern CA, I am familiar with the biotech industry. I have met someone who procures manufacture of medical devices from Mexico for ostensibly the Medicate market for a very health premium. So the device tax of less than 3% is not going to bankrupt anyone or stop any surgeries.
We can have better medical outcomes by getting rid of insurance except for catastrophic care. There is no price competition in medical care (no quality of care comparison either). If you have to ask the price you can’t afford is definitely the prevailing wisdom. What if there were prices and you could compare prices? Wouldn’t prices come down?? If people clip coupons and buy fluff from Groupon , could they not shop for medical care??
www.theatlantic.com/magazine/archive/2009/09/how-american-health-care-killed-my-father/307617/
We also need to make sure athletically challenged guys like me spend less time debating smarter guys and spend more time in the gym. (I did lose 3 lbs last month, only 25 to go)
I want all these companies to thrive because I have owned Vanguard Health care for nearly 20 years. Best fund ever, high return low(er) risk, even after my pal Gus retired.
BTW, I think Eventide funds are high beta that will be great to own after a big correction in its sector, not a buy and forget.
Regards,
Equalizer
Top Spine Surgeons Reap Royalties, Medicare Bounty WSJ December 20, 2010
http://online.wsj.com/article/SB10001424052748703858404576214642193925996.html
Well the double Dr. probably had to use the funds to buy his Gulfstream 5 so he can personally pilot it to see his five close friends on 5 continents in his free time.
Dr Hussman is also brilliant scholar but not necessarily the best investor.
Wait, so these guy are pumping Drucker and Porter and mocking patron saint of capitalism - the beloved Chicago school Milton philosophy that presaged the 2008 Armageddon? Those sad socialists.
You noted: Which insurance? Company, government sponsored or ?
I'm attempting to determine what type of medical insurance I would eliminate for myself, our family or my parents to the point of having only catastrophic care coverage.
I'm imagining a sinus infection, untreated; becoming more involved in the lungs, leading to treatment at some point as a major complication for the entire body. This is only the medical portion of the situation, and doesn't factor loss of ability for a time period for productive work, running a household and/or taking care of young children dependent upon a healthy parent, etc.
Thank you for your time with your reply.
Regards,
Catch
I switched to a CDHP plan about 3 years ago. I was nervous and hesitant at the time, but it's been a great way to go. I fund an HSA account with the money I saved by not paying for the higher HMO or PPO plans. So at the end of the year I've put money in the bank, tax free, instead of throwing it away on high premiums. If this was the way health care worked for everyone, people would look for value and competition would lower health care prices.
To Catch22's point, why would you not take care of that sinus infection before it got more serious? Why would you leave it untreated? You don't have to pay exorbitant monthly premiums to take care of that sinus infection. For most healthy people, paying out of pocket when needed and having that safe guard for catastrophic events is still much cheaper than paying a high monthly premium every month that you may or may not use. At least that has been the case for my wife and I.
Anyway Equalizer, I'm with you.
You noted: I guess I should have prefaced; that the infection was attempted to be treated with sinus passage flushes with a saline solution and any other treatment that could be discovered on the internet. Infection is infection; and not always a condition that one may resolve with home remedies, etc.
Are there not any medical conditions not treatable by an individual; that must wait until the issue becomes very serious in order to quality for a catastrophic circumstance or insurance coverage?
I must state that the "upside" for medical non-treatment (resulting in death, of course) to many above the age of 65, including their parents, is that the burden to Medicare, Medicaid and Social Security would be greatly reduced and have a most positive affect upon the debt of the U.S. A likely downside, however; is a nasty impact upon the housing market and related business (Lowe's, Home Depot). Not sure how to deal with the younger crowd and their medical treatments. Few things are simple, eh?
Take care,
Catch
My argument and I think 'equalizers' mention of catastrophic insurance is that paying the health care bill yourself instead of the insurance company forking over the money gives the consumer an appreciation of costs. That would lead to price competition between health providers. Believe me, if consumers started looking for the best price, health providers would find a way to compete. I think that was the original point.
We may be arguing different point.