If you have a regular brokerage account, it’s easy to add healthcare stocks to your taxable investment portfolio. For retirement investors, buying healthcare stocks in tax-advantaged retirement plans like IRAs is a good option. However, if you have a 401(k), you may need to explore mutual funds that focus on the healthcare industry instead of individual stocks.
When considering a new investment in healthcare stocks or any other market sector, it’s important to do your due diligence. While large-cap stocks are generally safer, small-cap biotech stocks can be riskier. Buying individual stocks is inherently risky, so it may be wiser to consider purchasing ETFs or index funds that track diversified indexes in the healthcare sector. These options are less affected by the ups and downs of individual companies and offer solid long-term growth potential, making them a popular choice recommended by financial advisors.
Remember, the author(s) did not hold any positions in the securities discussed at the time of publication.