Healthcare Stocks Are Having a Good Year. Should You Buy a Fidelity or iShares ETF to Profit?

Brendan Coffey, The Motley Fool

Sat, August 1, 2026 astatine 12:48 PM CDT 5 min read

Fidelity MSCI Health Care Index ETF (NYSEMKT:FHLC) offers a importantly little disbursal ratio and broader diversification than the iShares U.S. Healthcare ETF (NYSEMKT:IYH), portion some clasp akin blue-chip positions.

These 2 exchange-traded funds supply targeted vulnerability to the U.S. healthcare sector, covering industries from pharmaceutical giants to biotechnology firms. Both the Fidelity and iShares funds support important assets nether absorption (AUM), but their differences successful interest structures and portfolio extent whitethorn power which conveyance amended suits an investor's goals.

Snapshot (cost & size)

Beta measures terms volatility comparative to the S&P 500; beta is calculated from monthly returns implicit the disposable money past (up to 5 years). The 1-yr instrumentality represents full instrumentality implicit the trailing 12 months. Dividend output is the trailing-12-month organisation output arsenic of the adjacent of trading connected July 30.

The Fidelity money is notably much affordable for semipermanent holders, charging conscionable 0.08% annually, compared with the iShares fund's 0.38% disbursal ratio. This outgo quality represents a superior divergence betwixt these 2 healthcare-focused concern vehicles.

Performance & hazard examination

What's wrong

Fidelity MSCI Health Care Index ETF seeks to way the MSCI USA IMI Health Care Index, which results successful a wide portfolio of 334 holdings. It allocates 99% of its value to healthcare companies with a tiny information to fiscal services. Its largest positions see Eli Lilly & Co (NYSE:LLY) astatine 14.4%, Johnson & Johnson (NYSE:JNJ) astatine 9.1%, and Abbvie Inc (NYSE:ABBV) astatine 6.5%. The money was launched successful 2013. It has paid $1.02 per stock implicit the trailing 12 months, which connected its caller ~$79.44 stock terms works retired to a 1.3% yield.

The iShares U.S. Healthcare ETF offers a much concentrated strategy with 100 holdings, chiefly mirroring a benchmark of established American healthcare firms. The money allocates 100% to healthcare. Top positions see Eli Lilly astatine 16.1%, Johnson & Johnson astatine 10.3%, and AbbVie astatine 7.5%. The money was launched successful 2000. It has paid $0.80 per stock implicit the trailing 12 months, which connected its caller ~$68.82 stock terms works retired to a 1.2% yield.