After the Democrats lost some seats in the mid-term elections, you might be wondering whether health care revenue and exchange traded funds (ETFs) will be affected by the shift. Some don’t believe there’s anything to worry about for a while.
First, with most corporations backing major Congressional players, it is almost certain that the medical industry will maintain some say in Washington, according to ETF Zone.
In addition to that, an aging population, higher obesity rates and chronic medical conditions will keep demand for medicine high.
And don’t forget about the power of overseas markets. Exports to foreign markets have become cheaper as the dollar depreciates against a basket of currencies.
With the passage of the health-care bill, FAF Advisors analyst Tim Nelson believes that “increased regulatory requirements mean less innovation, less differentiation and more pricing pressure for the foreseeable future,” report Eben Esterhuizen and Alicia Sellitti for The Motley Fool. The legislation should bring in more customers but that won’t likely occur until years into the future. [Biotech ETFs May Soon Face Challenges.]
For now, health care ETFs may see a bit more tepid growth and there are some things to look out for. Consumers are reducing expenses by buying fewer products and services that medical practitioners consider essential, and a good chunk of pharmaceutical patents are set to expire in the coming years and companies will have to compete with cheaper generics.