Health care stocks, with subdivisions including biotechnology, pharmaceuticals, insurance providers and telemedicines, have come into focus as the world grapples with a health crisis that is not going to end any time soon. With the need for medical supplies as well as care and medicine, many health care stocks have begun to make names for themselves amid the pandemic. Biotechs like Moderna Inc.
Just like any large sector, there are a few different angles an investor can look at when investing in health care exchange-traded funds. Here are a few health care ETFs that give various approaches to trading:
Health Care Select SPDR Fund
This ETF is popular, and for a good reason. XLV provides exposure to nearly every aspect of the health care sector while managing close to $22.4 billion in assets and high volume trades. This fund providers exposure to health care equipment and supplies, insurance providers and services, as well as biotechnology holding a significant portion of holdings. Heavy weight pharmaceuticals account for nearly 33% of the funds components and the fund is relatively cheap compared to other healthcare ETFs. All and all, XLV is a relatively safe and cheap trade.
Vanguard Health Care ETF
VHT offers the broadest exposures to all aspects of the health care sector with 389 stocks within this fund. The ETF is also cheap to hold, with low fees and excellent tracking. Although competitor XLV handles greater volume, VHT has healthy liquidity and is for the investor interested in the long-term.
iShares U.S. Healthcare ETF
IYH also gives an investor great exposure to health care sector, holding the industry's largest pharmaceuticals, medical and biotechnology companies that trade on Wall Street. Popular and reliable, this fund trades well, but not to the same degree at XLV and contains higher holding costs.
iShares U.S. Healthcare Providers ETF
This ETF gives a more focused approach to health care trading, following 48 health care providers on the Dow Jones
Invesco S&P 500 Equal Weight Health Care ETF
This ETF holds health care stocks along the S&P 500
Invesco DWA Healthcare Momentum ETF
PTH is an alternative take on the health care sector, with emphasis on biotechnology and research over pharmaceuticals and health care providers. This narrow fund only has 47 holdings, with small tilts and more risk compared to other health care ETFs. Although PTH is not really for the long-term investor due to its costs and risk, this fund offer a growth-focused approach to health care.