Innovation-driven by rising demands on the healthcare system can create a strong growth environment for traders using the Direxion Daily Healthcare Bull 3X ETF (CURE ).
The rising population and improved medical technology is causing individuals to live longer. As such, the healthcare system will be forced to take care of an aging population, which could help drive innovative technologies in administering care.
“Innovation in the medical arena is poised to accelerate over the next decade,” an Investorplace article noted. “Aging demographic trends stateside and across the world, along with rapid advances in technology, should create significant growth opportunities for healthcare stocks.”
The pandemic only accelerated this need for more innovative healthcare technology. As such, this is certainly opening up opportunities for investors in the healthcare sector.
“The pandemic has been forcing healthcare providers to adopt new tools,” the article added. “And the aging and growing global population fuels demand for innovative treatments. As a result, companies that successfully merge healthcare and technology should be at the top of the shopping list of all long-term investors.”
In addition, short-term investors who want to utilize leverage can also stand to benefit. Enter funds like CURE, where traders can play the short-term fluctuations in healthcare, particularly if they’re looking for a bullish slant.
Triple the Leverage, Triple the Gains
CURE seeks daily investment results equal to 300% of the daily performance of the Health Care Select Sector Index. The fund achieves this exposure by investing at least 80% of its net assets in financial instruments, such as swap agreements, securities of the index, and ETFs that track the index, and other financial instruments that provide daily leveraged exposure to the index or to ETFs that track the index.
The index includes domestic companies from the healthcare sector, which includes: pharmaceuticals, healthcare equipment, and supplies; healthcare providers and services; biotechnology; life sciences tools and services; and more. These sub-industries have all been affected by the pandemic in some form or fashion, giving traders dynamic opportunities to play the market.
Up 72% for the year, bulls have been on the right side of the healthcare trade in 2021. In terms of technical trading, short-term and long-term momentum are showing strength with the 50-day and the 200-day moving average in uptrends.
The relative strength index is heading towards overbought levels, but any subsequent price adjustment could be an entry point. CURE has been trading above its 50-day moving average since the start of summer so that near-term strength could persist through the year.