During the last recession, healthcare stocks generally weathered the changes. In recent years, they’ve also seen significant profit growth, according to the op-ed.
However, as the presidential election approaches and some Democratic presidential candidates call for an overhaul of the healthcare system, the stocks may not be as resilient as they once were, according to the report.
“Investing heavily in health stocks requires skepticism about the potential for significant policy change. That’s not a crazy position, but anyone sticking with the sector will need a strong stomach,” according to the op-ed.
Healthcare stocks may take large hits even if the odds of significant policy change, such as “Medicare for All” and drug price reduction proposals, only increase slightly.
“Investors willing to wait out the coming political, economic and regulatory roller coaster may be rewarded. Those seeking a smooth ride should look elsewhere,” according to the op-ed.
Read the full report here.
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