Should I Buy Healthcare Select Sector ETF (XLV)? Finance YouTuber Analysis

The analyst suggests investing in healthcare (XLV) as a defensive play, noting its historical performance during market corrections. In the last market crash, healthcare stocks in the XLV gained 6% while the tech-heavy NASDAQ fell, making it a good option for portfolio rebalancing.

“healthcare, the XLV, and then even bonds in the Vanguard short-term bond ETF, that's the ticker BSV. Investing part of your money in these sector funds and the bonds won't make you rich, but should produce a respectable 10% on that part of your money.”

The YouTuber suggests buying the Healthcare Select Sector ETF (XLV) because the sector has lagged this year but is necessary and valuations are attractive. It trades at 17.3 times expected earnings, which is at its 5-year average and significantly cheaper than other sectors.

“The easiest path is just going to be to buy the whole healthcare select sector ETF. the ticker XLV which holds all 60 stocks within that group.”

The analyst favors the Healthcare ETF as part of a barbell portfolio strategy, suggesting it offers attractive value and can protect a portfolio during market sell-offs. This aligns with a broader market shift into sectors like energy and healthcare.

“Besides the broad ETFs with these sectors like the Energy Spider, the XLE, and the Healthcare ETF, ticker XLV, I'm also watching stocks like EOG Resources, ticker EOG, Chevron, CVX, United Health Group, UNH, and Novartis, NVS.”

The analyst suggests buying this ETF as a safer option during a potential market downturn. It benefits from stable cash flows to healthcare companies and has stronger earnings forecasts for the year, making it a protective investment.

“you should focus on the safer ETFs that are going to help protect your money these might include funds like the healthcare select sector spider the XLV which benefits from relatively stable cash flows to healthcare companies plus stronger earnings forecasts for this year within health care”

The YouTuber recommends buying XLV due to healthcare's strong expected performance in 2025, with an anticipated 18% earnings growth for the sector and 116% for pharmaceutical companies. He notes that healthcare spending is relatively stable during recessions, providing safety, and the ETF is already up 8.5% in the first two months of the year.

“Healthcare is set to have a very strong year and the overall fund the healthcare select sector spider ETF the ticker XLV is up 85% in the first two months alone.”

The YouTuber suggests the Healthcare Select Sector SPDR fund (XLV) as a defensive investment, arguing that people prioritize health regardless of economic conditions. This sector, encompassing pharmaceuticals, medical devices, and insurance, has historically shown resilience during downturns.

“Again, for diversification, look at ETFs like the Healthcare Select Sector SPDR fund or the Vanguard Healthcare ETF. These bundle together many of the top companies in the sector that have a proven track record.”

The YouTuber recommends XLV for its focused growth aspect within healthcare, higher trading volume for liquidity, and excellent expense ratio and dividend yield. He highlights its superior one-year and three-year performance compared to other healthcare funds discussed, with analysts projecting a nearly 15% upside.

“this fund has the highest trading volume which gives it more liquidity if you need to sell in a hurry and the beta is also incredibly low at 0.61 and I have to point out that the expense ratio is the best of the group at 0.09%”