We've had this fund as part of our retirement portfolio a bit over 15 years. While the returns of late have not been great, they are still better than the majority of funds we hold (-1.85% YTD a/o Aug 8th) .
At one time (in our early accumulation years), this single fund accounted for around 50% of our combined retirement portfolio, dropping over the years to our current 6.5% as we "spread our bet" over the years.
The reason we invested heavily in the early years was due to the fund manager Ed Ownens, who has been with Wellington Management over 30 years. The fund did well under his management style, even through the "scares" of public pharma management under previous administrations (remember Hillary failed attempt under her husband?)
More importantly, we keep the fund based upon the aging of the boomer population. As one who is part of this "surge", I/DW have increased our medications over the years, and don't think the general population is getting "healthier".
A lot of folks don't like pharma (regardless of specific fund) saying that the government will "take over" either distribution or pricing of drugs. IMHO, this is not a problem. If they manage distribution/pricing, you will see an increase in the amount of drugs distributed and profits will be kept up by quantity (if not quality) of drugs dispensed. As far as new drugs, there is a possibility that there might be fewer coming on-line, but remember, most drug development is done by smaller companies (who get acquired by large pharma). Personally, I don't see that going away.
With a new manager being added to the fund this year (assuming Ed will retire), the "quality of management" has three options - better/worse/same. Will that affect the fund? Don't know. Are we reducing our holdings (even though shown as "over invested" in most retirement planning tools)? Nope.
Anyway, that's my response to the OP's comment.
- Ron
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