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By Scott Burns | 07-15-2009 02:13 AM

How to Invest in Health-Care Reform

Scott Burns, director of ETF analysis, looks at long and short ways to use health-care ETFs ahead of major reforms.

Scott Burns: Hi there, I'm Scott Burns, director of ETF analysis with Morningstar. Lately, the health-care sector has been on a lot of investors' minds and has really been grabbing the headlines. This really stems from moves that the Obama administration and Congress have been looking to make to help stem health-care costs.

It's clearly one of the president's initiatives, and it looks like he's getting a lot of steam with the Democratic control of both the White House and of Congress.

Now, for ETF investors, there's a lot of different ways to play this health-care space. When we look at the broad nine-sector as GICS defines it, slicing and dicing of the sector universe, we find that the health-care sector, as determined by our equity analysts, is by far the most undervalued.

Of course that undervalued nature also reflects a lot of risk. There is a lot of uncertainty right now.

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