iShares Dow Jones US Medical Devices

Investors seeking exposure to health care but who are concerned about the uncertain regulatory environment and the potential impact that health-care reform might have on the sector could find iShares Dow Jones U.S. Medical Devices to be a suitable satellite pick. In our view, the medical-device industry should be pretty well insulated frommany of the cost-cutting pressures likely to come about as a result of health-care reform. Still, we stress that this fund should be used as a tactical satellite investment, not as a core position in any asset-allocation portfolio. Keep in mind that because of its focus on a single industry, the fund offers limited diversification benefits.

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