Buyers selecting between the Constancy MSCI Well being Care Index ETF (NYSEMKT:FHLC) and State Avenue Well being Care Choose Sector SPDR ETF (NYSEMKT:XLV) might discover that the previous supplies broader market-cap publicity whereas the latter presents superior liquidity and the next trailing-12-month dividend yield.
Each funds goal the home healthcare sector, offering publicity to prescription drugs, biotechnology, and tools suppliers. Whereas FHLC covers a wider vary of firm sizes together with mid- and small-cap shares, XLV focuses strictly on the healthcare parts of the S&P 500.
This alternative between broad-market diversification and blue-chip focus is a central consideration for buyers seeking to achieve focused sector publicity.
Snapshot (value & measurement)
|
Metric
|
FHLC
|
XLV
|
|
Issuer
|
Constancy
|
SPDR
|
|
Expense ratio
|
0.08%
|
0.08%
|
|
1-yr return (as of Could 18, 2026)
|
18.59%
|
16.86%
|
|
Dividend yield
|
1.40%
|
1.70%
|
|
Beta
|
0.61
|
0.58
|
|
AUM
|
$2.9 billion
|
$37.5 billion
|
Beta measures worth volatility relative to the S&P 500; beta is calculated from five-year month-to-month returns. The 1-yr return represents whole return over the trailing 12 months. Dividend yield is the trailing-12-month distribution yield.
Each funds are extremely cost-efficient with matched 0.08% expense ratios. Nevertheless, the State Avenue fund presents a barely increased payout for revenue seekers, with a trailing-12-month dividend yield of 1.7% in comparison with 1.4% for the Constancy fund. This distinction in yield might attraction to these prioritizing present revenue over barely increased latest development.
Efficiency & danger comparability
|
Metric
|
FHLC
|
XLV
|
|
Max drawdown (5 yr)
|
(17.70%)
|
(17.10%)
|
|
Progress of $1,000 over 5 years (whole return)
|
$1,231
|
$1,284
|
What’s inside
The State Avenue Well being Care Choose Sector SPDR ETF supplies concentrated publicity to 60 large-cap healthcare shares. Its largest positions embody Eli Lilly & Co (NYSE:LLY) at 15.18%, Johnson & Johnson (NYSE:JNJ) at 10.42%, and AbbVie (NYSE:ABBV) at 7.09%. Launched in 1998, it supplies 100% allocation to the healthcare sector and has paid $2.51 per share over the trailing 12 months. This fund focuses solely on established, high-liquidity firms discovered inside the benchmark S&P 500 Index.
The Constancy MSCI Well being Care Index ETF employs a wider technique with 365 holdings. Its prime positions embody Eli Lilly & Co at 13.16%, Johnson & Johnson at 8.90%, and AbbVie at 6.06%. Launched in 2013, the fund has a trailing-12-month dividend of $1.01 per share. By monitoring the MSCI USA IMI Well being Care Index, it captures small- and mid-cap firms that its competitor skips, although it stays fully invested in healthcare sector equities.
For extra steerage on ETF investing, try the total information at this hyperlink.
What this implies for buyers
For buyers looking for shares within the healthcare trade, the State Avenue Well being Care Choose Sector SPDR ETF (XLV) and Constancy MSCI Well being Care Index ETF (FHLC) provide an environment friendly strategy to achieve that publicity. This pair of funds take very totally different approaches, so deciding which to spend money on depends upon which technique higher matches your targets.
XLV focuses its holdings on healthcare firms inside the S&P 500. That’s why it sports activities solely 60 holdings, though its a lot increased AUM can attraction to energetic merchants. Nevertheless, over 25% of the ETF is concentrated solely on Eli Lilly and Johnson & Johnson. Consequently, the fund’s efficiency is extremely reliant on these companies.
XLV’s increased dividend yield and deal with blue-chip firms can attraction to extra conservative buyers, and those that wish to purchase and maintain for the long run.
FHLC presents a much more diversified fund with over 300 holdings, together with mid and small-cap shares that aren’t obtainable in XLV. This diversification reduces reliance on just a few firms, and opens up the potential for higher features, since smaller firms are likely to develop sooner than their massive cap brethren, as demonstrated in FHLC’s bigger one-year return.
That stated, smaller companies are likely to ship extra unstable efficiency, which contributed to FHLC’s increased beta and max drawdown. FHLC is for buyers who need broad publicity to the healthcare sector, and are comfy with extra danger and volatility because the commerce off for the potential of upper returns.
Do you have to purchase inventory in Choose Sector SPDR Belief – State Avenue Well being Care Choose Sector SPDR ETF proper now?
Before you purchase inventory in Choose Sector SPDR Belief – State Avenue Well being Care Choose Sector SPDR ETF, think about this:
The Motley Idiot Inventory Advisor analyst crew simply recognized what they consider are the 10 greatest shares for buyers to purchase now… and Choose Sector SPDR Belief – State Avenue Well being Care Choose Sector SPDR ETF wasn’t certainly one of them. The ten shares that made the lower might produce monster returns within the coming years.
Think about when Netflix made this listing on December 17, 2004… should you invested $1,000 on the time of our suggestion, you’d have $477,813!* Or when Nvidia made this listing on April 15, 2005… should you invested $1,000 on the time of our suggestion, you’d have $1,320,088!*
Now, it’s price noting Inventory Advisor’s whole common return is 986% — a market-crushing outperformance in comparison with 208% for the S&P 500. Do not miss the newest prime 10 listing, obtainable with Inventory Advisor, and be a part of an investing neighborhood constructed by particular person buyers for particular person buyers.
See the ten shares »
*Inventory Advisor returns as of Could 24, 2026.
Robert Izquierdo has positions in Johnson & Johnson. The Motley Idiot has positions in and recommends AbbVie and Eli Lilly. The Motley Idiot recommends Johnson & Johnson. The Motley Idiot has a disclosure coverage.
Higher Well being Care ETF: Constancy’s FHLC vs. State Avenue’s XLV was initially revealed by The Motley Idiot
