Next week is one of the biggest of the year for health care investors, and it’s historically been a great time to own ETFs that track the industry. The 2023 JPMorgan Health Care Conference is set to begin next Monday in San Francisco. The event includes keynote speeches from the CEOs of Sage Therapeutics and Eli Lilly, as well as presentations from dozens of other healthcare and biotech companies. The conference call is typically where many companies announce quarterly results, revise outlooks and update investors about clinical trials. While those updates may break either way for individual companies, they’ve been good news for the sector as a whole lately. Over the past five years, the largest ETFs in health care and biotech have seen positive returns on average in the first half of January, when the conference is typically held. The three funds below — the SPDR S&P Biotech ETF (XBI), the Health Care Select Sector SPDR Fund (XLV), and the iShares US Medical Devices ETF (IHI) — have risen during the first half year in four of the past five years. January’s The only negative period for each was 2022, when the broad market was at the beginning of last year’s bear market decline. XBI Fund has been the best performer in this sample with an average return of 3.4%. Health-care funds were down last year but still easily outperformed the broad market, burning the sector’s reputation as a defensive haven. And the conglomerate remains a popular area for investors in the new year. For example, Dan Niles, founder of the Satori Fund, named the XLV Fund one of his top picks for the year. However, the widespread interest in health care may be a reason for investors to be cautious. According to Strategus Research, health care was the top economic sector for equity ETF inflows in 2022, topping $13 billion, which may indicate that the group is too spread out. “With the spread effect of top 5 S&P 500 weights (now down from 19% tally), healthcare ETFs have been favored as defensive counters to mega-cap growth, posting record annual inflows The sector’s S&P 500 weighting also sits at a 50-year high of 16%. While we have seen more aggressive (as in March 2020) backdrop to strategic flows, we view risk aversion to position at least for months to come. Will portray as,” Stratageus ETF strategist Todd Sohn said in a note to clients. Investors should also note that any broad index fund in their portfolio may have a higher exposure to health care than in recent years. According to a note from Goldman Sachs, health care is now the second largest weighting in the S&P 500. Merck, Eli Lilly and AbbVie were some of the biggest positive contributors to the S&P 500 stocks last year. according to Goldman.