For XLV and rival healthcare ETFs, the good news is that the U.S. economy moving into the late-cycle phase, overall growth may slow and signs of an economic slowdown could pop up. Consequently, investors may also turn to defensive sectors that are less economically sensitive, such as health care.

Both Democratic presidential front runner Hillary Clinton and GOP hopeful Donald Trump support the right for the government to negotiate Medicare drug costs. Additionally, Clinton has previously stated she would tackle “price gouging” from drugmakers if she is elected.

Related: Healthcare ETFs Ready to Rally

“While healthcare as a sector does not look too bad, the weaker components can bring it down. In short, lagging relative performance can quickly turn into outright losses,” according to Barron’s.

For more information on the biotech sector, visit our biotechnology category.

Health Care Select Sector SPDR (NYSEArca: XLV)