Home / Guide to HealthShares ETFs / Vertical Investing

Vertical Investing

The majority of portfolio creation in mutual funds and ETFs is “horizontal.” Managers select the most prominent, blue chip companies across an industry, focusing their choices on the top layer of investment opportunities. We believe that the most innovative and exciting opportunities in healthcare are largely beneath the surface and can only be accessed though Vertical Investing.

HealthShares™ are structured to provide exposure to these opportunities.

Each HealthShares™ ETF is a vertically screened basket of stocks of large, mid, and small-cap companies in the healthcare, life sciences, or biotechnology industries. HealthShares™ ETFs are divided into three basic categories: Therapeutic Areas, Healthcare Business Activities, and International. Each Vertical drills down into a distinct sub-segment such as the diagnosis of diseases, the development of drugs, diagnostics, and medical devices and delivery systems.

HealthShares™ ETFs offer investors a precise instrument that leverages the potential of healthcare investing while mitigating the risks of single stock picking. Each ETF owns 22-25 stocks (except for the HealthShares™ Composite, which features 80 stocks from the HealthShares™ Composite Eligible Indexes) that provide diversification, as well as meaningful, concentrated exposure to a therapeutic Vertical investment.