Fed Rate Hike Sparks Market Volatility: 3 Top-Performing Healthcare Funds to Consider
The Federal Reserve raised interest rates for the first time since July 2023 on Wednesday, increasing its benchmark rate by 25 basis points to a target range of 3.75% to 4%. The decision was expected but still led to stock market declines as concerns over inflation and economic growth persist.
Consumer confidence has been subdued in recent weeks due to fears that the economy could slow, leading investors to shift towards more defensive assets. Inflation remains elevated, with the consumer price index (CPI) increasing 0.4% month-over-month in August and 3.4% on an annual basis.
Against this backdrop, healthcare funds are seen as a safe bet due to their defensive nature. Three such funds highlighted by Zacks Investment Research are Vanguard Health Care Fund (VGHCX), Janus Henderson Global Life Sciences D (JNGLX), and Fidelity Select Health Care (FSPHX).
These funds have impressive three- and five-year annualized returns of 8.7% and 5.4%, 14.9% and 8.5%, and 13.3% and 4.8%, respectively.