For many of the same reasons exchange-traded funds are so popular in bull runs, ETFs are appealing to investors in the market downturn; investors awaiting a turnaround in the economy, but not knowing which pockets will come out first ahead, are seeking broad market exposure, The Wall Street Journal reports.
Theres also the opportunity to invest in an ETF that invests in a solid, stable, boring sector of the economy that resists economic downturns, such as healthcare or consumer staples.
The Consumer Staples Select Sector SPDR, for example, is down 15% through Oct. 23, whereas the S&P 500 has taken a 38% beating.
As the Journal puts it, In addition to their recession-resistant qualities and the boost they will get from an aging population, many of the pharmaceutical stocks pay fat dividends.
The staff of Money Management Executive ("MME") has prepared these capsule summaries based on reports published by the news sources to which they are attributed. Those news sources are not associated with MME, and have not prepared, sponsored, endorsed, or approved these summaries.