There were plenty of areas of the market that performed well for investors in November, however. Here’s a look at an exchange-traded fund (ETF) in my portfolio that returned 8.4% for the month.

The best-performing sector in the S&P 500

The fund I want to highlight today is the Xtrackers MSCI World Health Care UCITS ETF (LSE: XDWH). It provides broad, global exposure to the Healthcare sector.

It’s doing really well at the moment because the Healthcare sector is on fire. In November, it was the best-performing sector in the S&P 500 index by a wide margin.

I got in at the right time

Now, I added this ETF to my SIPP back in late October (I highlighted this trade in an article on 1 November). The reason I did so was that I wanted to diversify away from technology/artificial intelligence stocks (which have done really well for me but now look a little frothy).

This move paid off. While tech stocks and major indexes were choppy last month, this ETF basically went up in a straight line.

Still worth a look?

Even after its recent gains, I still believe it’s worth considering. To my mind, an allocation to healthcare stocks is a great way to diversify a portfolio.

For a start, healthcare is a defensive sector that has different drivers to the tech sector. If tech stocks experience some short-term weakness (which I think is a real possibility), capital could flow into this sector.

Second, this ETF offers exposure to some brilliant companies. Right now the, top five holdings are:

• Eli Lilly – a pharma powerhouse having a lot of success with weight-loss drugs
• Johnson & Johnson – a healthcare giant that specialises in oncology and medical technology
• AbbVie – a lesser known healthcare company that specialises in immunology, oncology, and neuroscience
• UnitedHealth – the largest health insurance company in the world
• AstraZeneca – the largest pharma company in the FTSE 100

Note that with this ETF, an investor gets exposure to a lot of exciting healthcare innovations. Some examples here include weight-loss drugs, robotic surgery, and smart glasses.

I’ll be buying more

It’s worth pointing out that this ETF has a great long-term track record. Over the last 10 years, it has returned about 120% in USD terms.

Another attraction is its fee structure. Fees are low at just 0.25% per year (plus any platform charges).

Obviously, the fact that it’s focused on one sector adds risk. If the Healthcare sector was to experience some challenges in the years ahead, this ETF could underperform.

I see it as a great portfolio diversifier though. I plan to buy more ETF units for my portfolio in the months ahead.

The post This ETF returned 8.4% last month while the FTSE 100 and S&P 500 indexes were flat appeared first on The Twelfth Magpie.

Could we be looking at a sharp pullback after these explosive gains? Let’s discuss.

Astonishing returns

Over the last three years, the Nasdaq has delivered annualised gains of around 30%. That’s an incredible return.

Now, at the end of 1998, about 15 months before the dotcom crash, the index was showing similar kinds of returns. So, that’s a bit concerning.

But here’s the thing. In 1999, the index rose a whopping 85%.

In other words, there was a huge move higher (a ‘blow-off top’) right before the rally came to an end. This suggests that there could potentially be more gains to come before this rally ends.

Is this the 90s again?

Of course, while this rally could play out like the rally of the late 1990s, it may not. There are a few key differences between now and then.

For a start, tech valuations aren’t outrageously high (in general) like they were in the late 1990s. Sure, there are some stocks that look a bit detached from their fundamentals like Tesla and Palantir, which trade on price-to-earnings (P/E) ratios of 259 and 287, respectively. But other stocks look quite reasonably priced. Alphabet, for example, currently trades on a P/E ratio of 25. Amazon is on 34 – near a historical low.

Second, most of the most popular stocks today (think the Magnificent 7) have diversified operations, tons of cash flow, and strong balance sheets. Back in the late 1990s, it wasn’t like this – many of the most high-profile names were companies with minimal revenues that went on to go bankrupt (such as pets.com, eToys.com).

Prone to sharp pullbacks

One thing I will say, however, is that the Nasdaq does tend to experience sharp pullbacks on a regular basis. We saw them in 2018, 2022, and the first half of 2025.

Ultimately, volatility is the price of admission with this index. It has a fantastic long-term track record, but it is prone to meltdowns at times.

Managing risk

Given its history, it’s worth thinking about risk management. One doesn’t want to be overexposed to the index or the stocks in it.

One way investors could potentially manage risk is by allocating some capital to non-tech ETFs. These products could provide portfolio protection if tech stocks suddenly plummet.

A product that could be worth considering is the Xtrackers MSCI World Health Care UCITS ETF (LSE: XDWH). This provides broad exposure to the Healthcare sector.

There are a few reasons I’ve highlighted this ETF in particular. First, healthcare is a defensive sector and relatively uncorrelated to technology. If tech stocks experience weakness, capital could flow into this sector.

Second, it offers exposure to some great companies. Top holdings include the likes of Eli Lilly, Johnson & Johnson and AstraZeneca.

Third, it has a great long-term track record. It also has low fees.

Finally, healthcare stocks are out of favour right now. As a result, many look cheap.

Now, there’s no guarantee that this ETF will do well in the near term, of course. The healthcare industry is facing some challenges today due to US regulation.

I see plenty of potential in the long run, however. So, I think it’s worth a look.

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