I charted an investment in FCNTX on the day Will Danoff became the funds manager (09/17/1990) vs. LEXCX.

I wanted to indulged your chart a bit further. 1990 was about the time when I first invested in Vanguard Healthcare, VGHCX. Here are LEXCX, FCNTX, and VGHCX over the last 25 years:. All three seem to have great market cycle performance (30ish years).

" In 1945, the largest 25 mutual funds in the United States cost an average of 0.76 percent per year. ... The biggest active funds in 2004 cost 1.56 percent."
I don't know about 2004, but in 2015, the average ER of the 25 largest active funds (using the share class that M* picks with "distinct portfolio") is 0.66%, about 13% lower than it was in 1945.
"No active fund is as cheap as it appears [because of trading costs]." Misleading in a couple of ways, the main one being that index funds also have trading costs (for the most part, it's turnover, not index vs. active, that matters). The minor issue is that there is a fund that never changes its portfolio, and it's not an index fund. Most of the people here don't need to be reminded of it - LEXCX.
If one talks about bond funds, even index funds, they're going to have a lot of trades, because they're constantly replacing bonds that mature (or come too close to maturity to keep in the portfolio). Looking at the pure equity funds in the largest 25 active, one sees turnover ratios ranging from 11-12% (D&C Int'l DODFX and Harbor Int'l HAINX) all the way up to 45% (Fidelity Contra FCNTX); no other fund is above 0.39%. These are all way below the "average" fund's 72% turnover.
Then there is a trading cost particular to index funds - front running (related to reconstitution). No mention of it in this article. And what about index funds that are not market (or at least free float) weighted? They have higher turnover by design. See, e.g.
http://www.investingdaily.com/11263/equal-weighted-index-etfs-pros-and-cons/
None of this is to suggest that index fund "hidden" costs are higher than active fund costs. Just that it would be nice to read articles that didn't start from a conclusion and apply data selectively to reach that conclusion.
For completeness, the bond/hybrid funds in the largest 25 funds are:
ABALX, CAIBX, AMECX, MBLOX, SGENX, FKINX, MWTRX, PTTRX, TPINX, VFSTX, VWELX
The equity funds in the largest 25 funds are:
AMCPX, CWGIX, AEPGX, ANCFX, AGTHX, AIVSX, ANWPX, AWSHX (all American Funds!), and DODFX, DODGX, FCNTX, HAINX, VGHCX, VWNFX

Over the last 20 years Health Care funds have shellac the overall market in both to the upside on gains as well to the downside on losses. Here's VGHCX (Health Care) vs VTSMX (the Market) over the last 20 years. Will this continue?

Bought a bit of WOOD several years ago, I think about the time GMO recommended forests. Up 45+%, which is so-so, but it takes a while to make a tree. Don't know what I would do now. WY looks like it has a good dividend, but the rating services at TDA dislike it. The chart is steadily up, however. Will watch.
If Fido's New Markets Income counts, I was heavily in, but less so now. Out completely a year or so ago, but lightly in now and positive returns so far. Haven't had the nerve to plunge as I age.
VGHCX for > 10 yr; FBIOX has been good; peaking, but probably safe with Republicans controlling Congress. Looking around the sidewalks, health care funds have to do fairly well. The services can't be moved off-shore; the demographics can't be ignored; and cost controls won't be placed to any great extent.

Yes, like many, I invest chiefly in managers, not funds. I would never want to bet on and hope for continuity, momentum, 'something going right long term'. Glad VGHCX abides. I was interested in seeing if any of the 30 listed have had one manager for 20y.

OK, hate to do this...... but for Vanguard pump & you asked
MY main focus 10 yr. figures right thru the 2008 disaster;
VGHCX +13.19 yr. avg
VHCOX +10.65 "
VPCCX +10.56 "
YACKX +10.41 (counted as Vanguard..not.... but my #2holding
Balanced:
VWIAX +7.45 (60% bonds)
VWELX +8.14 (30% bonds)
V.ETF's:
VHT +11.1 (10 yr)
VYM +15.5 (5 YRS)
Bonds;
VWEHX +6.5
PRHYX +7.7
10 Managed untouchables for long term, other 20 Mostly stocks could be gone at anytime

T. Rowe Price Capital Appreciation Down 0.28 Down 1.07% PRWCX 
Franklin Mutual Quest Z Down 0.19 Down 1.17%  MQIFX
Queens Road Small Cap Value Down 0.28 Down 1.18%  QRSVX
BlackRock Global Allocation Inv A Down 0.24 Down 1.21%  MDLOX
Greenspring Down 0.30 Down 1.21%  GRSPX
AMG Yacktman Service Down 0.31 Down 1.24%  YACKX
RiverNorth Core Opportunity R Down 0.15 Down 1.24%  RNCOX
Grandeur Peak Global Opportunities Inv Down 0.04 Down 1.26%  GPGOX
Jensen Quality Growth J Down 0.52 Down 1.30%  JENSX Sparkline Chart
And of course the best
Vanguard Health Care Inv Down 1.31 Down 0.62%  VGHCX
I think Greenspring has faltered. PRWCX is just rock solid. JENSX is underrated.

Yes: POAGX, FSPHX, VGHCX (this should be fun - hope you are referring to SPY with 13.75% from Yahoo or 13.46% from M* :-) ).

I thought I was a little crazy buying Vghcx at $187 a share. Been happy with it, as I have PRHSX, but DCA into that funds years ago.

I am really conflicted....VGHCX hit a dollar threshold where it's due for a 30% haircut per my established portfolio guidelines. The problem is, it's been on fire and I may look back on this as a foolish and profit limiting re-balancing exercise. I am thinking about just letting the year-end distribution go to cash, and then direct that to the divi payors I had earmarked for the larger allocation.
Frankly, I admit this is not the worst problem to have.

Nice problem to have. With long term persistent smooth upward momentum (something Junkster would be proud to own) why not monitor for a 20 or 50 day crossovers to the 200dma. No sell signals over this last three years using this method.
Here's an article from Seeking Alpha that might be of interest:
no-one-ever-went-broke-taking-profits

I am really conflicted....VGHCX hit a dollar threshold where it's due for a 30% haircut per my established portfolio guidelines. The problem is, it's been on fire and I may look back on this as a foolish and profit limiting re-balancing exercise. I am thinking about just letting the year-end distribution go to cash, and then direct that to the divi payors I had earmarked for the larger allocation.
Frankly, I admit this is not the worst problem to have.

First I've ever seen VGHCX, labeled as (most) "Aggressive" , but maybe that might scare the mice away

"The bigger question might be at what point does an investor have too much in healthcare? "
When Health care investments start earning less than the Stock market as Whole, that would be a good time, if we live long enough to start seeing declines in Health Care costs, my guess...we won't

For me, this is where charts can be a handy tool to monitor smaller components (in this case HC) in a more diversified holding (VTI):
Since 1993, VGHCX has never trailed (in any significant way) VTI and the difference in performance might pay for that hernia operation from lifting too much snow (catch22) or too many 40 oz bud lights (TB):

Hi @mcmarasco
You noted: "Does anybody have any thoughts on Blackrock Healthcare (SHSAX) "Load Waived" at FIDO or Vanguard Healthcare (VGHCX) also at FIDO and GOLD rated by M*?
I like the idea a pairing with another fund such as FBIOX, any suggestions or comments?
FIDO shows PRHSX (TROWE) as "closed" to new investors even though it is "open" at TROWE. Any insight or suggestions?"
>>>For broadbased healthcare, I do not find an advantage to holding Vanguard or others when compared to FSPHX. The performance is similar looking backwards. There is and will be variances over other time frames depending on manager actions. As you are already "inside" of Fido with your account, I personally don't find a need to move outside of Fido offerings. I have not checked for overlap; but you could also consider a more directed play towards pharma with FPHAX or directed towards the delivery side of medical services with FSHCX.
With the exception of FBIOX, of which; FSPHX has a chunk of this action, over a 5 year time frame, FSPHX is a most suitable and able performing healthcare fund when compared to all other active managed funds.
We've considered mix and match with the several Fido medical area funds; but have remained with our monies in FSPHX.
Fido also has an etf (can't recall the ticker), either via I-shares or Fido for healthcare.
Lastly, I personally would not invest any less than 5% of a total portfolio in a given sector, in order to provide enough momentum to a portfolio. 'Course 5% can also go against the portfolio, too. :)
As others have also noted; your other equity fund holdings may alread have your portfolio at 5% of total holdings in healthcare. Many broadbased equity funds owe their YTD gains to healthcare holdings. I personally find no problem with adding to this sector, as dedicated holdings.
As always, just suggestions; eh?
Take care,
Catch

Thank you all for some great info, insight and suggestions!!
Does anybody have any thoughts on Blackrock Healthcare (SHSAX) "Load Waived" at FIDO or Vanguard Healthcare (VGHCX) also at FIDO and GOLD rated by M*?
I like the idea a pairing with another fund such as FBIOX, any suggestions or comments?
FIDO shows PRHSX (TROWE) as "closed" to new investors even though it is "open" at TROWE. Any insight or suggestions?
Thanks,
Matt

Missed VGHCX +25.3 ytd (Morningstar).... any others?

Holding VGHCX, VPMAX & FBIOX, I have to agree with Jerry. Health care funds will be important for the 30 years that it takes the boomers to move from retirement to interment (I think that's an original phrase), but I don't know which companies to pick. Admittedly, I think medical biotech offers the best upside for the foreseeable future, but a less constricted health fund may do better later.
General stock funds gravitate to their areas of expertise, and they may not have a good health sector analyst, although they should. Consequently, they will invest in areas that they understand.

@davidrmoran.
If you are lucky enough to own SEQUX, congrats.
That one is a lifer, regardless of its shorter term score in any backward looking rating system.
I think the Ulcer Index is reflecting current volatility in markets, bonds as well as equities.
But it's not all bad. Some long-term stalwarts seem to be able to handle the current environment quite well.
Here's list for conservative-moderate investors:
http://www.mutualfundobserver.com/fund-ratings/?symbol=FASIX+VWINX+GABCX+MERFX+GLRBX+JABLX+VWELX+VBINX+TGLMX+JAFLX+DODIX&submit=Submit
Here's list for moderate-aggressive investors:
http://www.mutualfundobserver.com/fund-ratings/?symbol=FPACX+VGSTX+MBAIX+PRWCX+FPURX+AADBX+FBALX+NOIEX+TRSGX+MDISX+VGHCX+TWEIX&submit=Submit
Finally, for aggressive investors:
http://www.mutualfundobserver.com/fund-ratings/?symbol=FEAFX+TWEBX+LEXCX+ELFNX+SMGIX+TBGVX+VPMCX+DPDEX+OAKMX&submit=Submit
c

One of the Best, thank You Vanguard....
Performance VGHCX More...
Expense; 0.35%
1 Yr +19.68
3 Yr +32.5
5 Yr* +27.75
10 Yr +12.69
*
Growth of 10,000 11,968 10,096 13,252 20,851 25,276 33,021 (10yr)

Since you're moving to Vanguard, why not try to get into some of their active funds?
VDIGX, any of the Primecap funds, VASVX, VGENX, VGHCX. Maybe avoid those that rely too extensively on the Vanguard subadviser model.