Healthcare is now the best performing sector year-to-date, up about 13%. It has been outperforming other sectors over the past few months and was also the best performing sector in Q3. Some big money managers have reduced their positions in technology, which had run-up a lot over the past few years, and added to their positions in healthcare stocks. Healthcare sector valuations still look attractive.Further, most healthcare giants have cash rich balance sheets. They were able to repatriate their overseas cash thanks to tax reform, and have spent it on dividends, buybacks and acquisitions.Historically, healthcare has outperformed the broader market during a period of rising interest rates. It is also seen as a defensive play and many investors have poured money into this sector in view of the ongoing market volatility. Additionally, recent earnings reported by healthcare companies have been strong.The longer-term outlook for healthcare remains positive as the sector is a direct beneficiary of the world’s rapidly aging demographic trend. Further, in many developing countries, governments are increasing their healthcare support. And in these countries, healthcare spending is rising from a very low level and has a significant potential to go up as income levels in these countries rise.To learn more about the SPDR Health Care Select Sector ETF (XLV) and the Vanguard Health Care ETF (VHT), please watch the short video above. Want key ETF info delivered straight to your inbox?Zacks’ free Fund Newsletter will brief you on top news and analysis, as well as top-performing ETFs, each week. Get it free >>Want the latest recommendations from Zacks Investment Research? Today, you can download 7 Best Stocks for the Next 30 Days. Click to get this free report Pfizer Inc. (PFE): Free Stock Analysis Report Johnson & Johnson (JNJ): Free Stock Analysis Report SPDR-HLTH CR (XLV): ETF Research Reports VIPERS-HLTH CR (VHT): ETF Research Reports UnitedHealth Group Incorporated (UNH): Free Stock Analysis Report To read this article on Zacks.com click here. Zacks Investment Research Want the latest recommendations from Zacks Investment Research? Today, you can download 7 Best Stocks for the Next 30 Days. Click to get this free report