Health care stocks can earn investors big bucks, so long as they know which ones to pick, said William Muggia, portfolio manager at Touchstone Mid Cap Growth Fund.
"Health care is a very diverse group, so there's big winners and big losers," he said.
His fund's two largest holdings are Celgene and Elan, whose multiple sclerosis drug Tysabri is "annualizing at $800 million" after being relaunched only two years ago.
But the company's biggest potential lies in its Alzheimer's treatments, Muggia said. Elan recently presented phase-two data on the disease, which will "potentially be the first disease-modifying agent ever in Alzheimer's," he said. The company will present the full data set on the drug July 29.
Muggia placed Elan's market cap at $16 billion.
Disclosure information was not immediately available for Muggia or his fund.