The best healthcare ETFs give investors exposure to a defensive corner of the market, one that’s likely to benefit from consistent demand and rising prices over the long term.
The Baby Boomer generation has reshaped the U.S. economy in many ways. The most meaningful change is arguably still to come as this large cohort of Americans enters their golden years.
By the year 2030, older Americans aged 65 and up will account for 20% of the entire population, up from 18% today. And, by 2060, nearly one in four Americans will be above the age of 65, according to the Census Bureau.
While few things are certain on Wall Street, it's all but guaranteed that these older adults are going to need a lot of care in the years to come.
That means a long-term demographic tailwind that will provide growth and stability for the healthcare sector – and positive returns for the best healthcare ETFs.
It can be hard to pick individual winners and losers among healthcare stocks. Instead of putting all their eggs in one basket, healthcare ETFs allow investors to diversify across a group of stocks or industries.
And, thankfully, there are a number of diversified and established funds that provide easy access to this healthcare megatrend.
That said, here are six of the best healthcare ETFs to buy now.
When compiling our list of the best ETFs to buy, we included a wide selection of healthcare-related exchange-traded funds that meet several different investment objectives. Take a look.
Data is as of March 5. Dividend yields represent the trailing 12-month yield, which is a standard measure for equity funds.
Best healthcare ETFs to buy
| Exchange-traded fund | Ticker |
|---|---|
| Health Care Select Sector SPDR Fund | XLV |
| Vanguard Health Care ETF | VHT |
| SPDR S&P Biotech ETF | XBI |
| iShares Global Healthcare ETF | IXJ |
| ARK Genomic Revolution ETF | ARKG |
| First Trust Health Care AlphaDEX Fund | FXH |
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Health Care Select Sector SPDR Fund
- Assets under management: $38.9 billion
- Dividend yield: 1.5%
- Expenses: 0.08%, or $8 annually for every $10,000 invested
When it comes to the best healthcare ETFs, the Health Care Select Sector SPDR Fund (XLV, $149.66) is the leader as far as assets under management.
It's elegantly simple, taking every healthcare component in the S&P 500 index of large U.S. stocks and excluding all the other stocks from the remaining sectors.
That approach leaves the fund with 64 of the largest healthcare stocks on Wall Street, including Big Pharma mainstay Eli Lilly (LLY), insurance giant UnitedHealth Group (UNH) and industry icon Johnson & Johnson (JNJ).
It's worth noting that these stocks are then also weighted by size, so these top three positions alone represent more than 28% of the entire portfolio. But if you want to focus on the leaders, both because of their scale as well as their stability, that may not be a drawback.
The fund has the top five-star rating from Morningstar and is the go-to healthcare ETF for those seeking out the best long-term investment stocks.
Learn more about XLV at the State Street Global Advisors provider site.
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Vanguard Healthcare ETF
- Assets under management: $16.9 billion
- Dividend yield: 1.4%
- Expenses: 0.09%
If you want to look beyond the usual suspects when it comes to the best healthcare ETFs, the Vanguard Health Care ETF (VHT, $272.55) provides a deeper bench of roughly 420 total components.
This means plenty of the healthcare names you know and love along with smaller companies that may not be as familiar.
Top holdings currently include Eli Lilly, UnithedHealth, Johnson & Johnson as well as Big Pharma stalwarts AbbVie (ABBV) and Merck (MRK) and diagnostics research firm Thermo Fisher Scientific (TMO).
Though there are a lot more smaller names in VHT, it's worth noting that this Vanguard ETF is weighted toward the largest stocks. In other words, the list of top holdings is quite similar to what is found in XLV.
However, if you think there's something to be said for adding a bunch of smaller and more aggressive healthcare companies into the mix along with the traditional mainstays, then the Vanguard Health Care ETF could be an attractive option for your portfolio.
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SPDR S&P Biotech ETF
- Assets under management: $5.6 billion
- Dividend yield: 0.15%
- Expenses: 0.35%
Investors not afraid of risk might want to leapfrog the most prominent healthcare companies out there and instead focus on development-stage biotechnology firms with dynamic potential.
If this approach appeals to you, then consider the SPDR S&P Biotech ETF (XBI, $87.82). XBI excludes traditional healthcare and Big Pharma names and instead focuses on the world of research-driven biotech stocks.
The lineup for this biotech ETF includes small-cap stocks such as weight-loss drugmaker Viking Therapeutics (VKTX) and gene-based therapy developer CRISPR Therapeutics (CRSP).
Companies like these often are not yet profitable as they plow their cash into developing new and innovative therapies.
But, if things go well, their share price can often skyrocket on news of favorable drug trials or approval from the Food and Drug Administration (FDA).
There is more risk in this corner of healthcare. However, if you're more interested in startups developing next-generation cures than the old guard in this sector, XBI is one of the best healthcare ETFs investments.
A bonus for many investors is that it has almost no overlap with core holdings in the S&P 500, so you can layer it into your portfolio without redundancy.
Learn more about XBI at the State Street Global Advisors provider site.
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iShares Global Healthcare ETF
- Assets under management: $4.0 billion
- Dividend yield: 1.4%
- Expenses: 0.41%
When you think about what to add to your portfolio, it's important to acknowledge that many healthcare leaders are multinational companies with global reach.
That's true for domestic names that do brisk business abroad as well as Japanese and European companies that are common names in U.S. medical facilities.
Exposure to the international nature of healthcare is why many investors find the iShares Global Healthcare ETF (IXJ, $94.18) a preferable alternative to funds that focus on American companies.
IXJ is indeed biased toward the U.S., with more than 70% of the fund invested in domestic names. But it also has a healthy dose of international stocks from developed markets like Switzerland, the U.K. and Denmark.
This approach allows the inclusion of stocks such as Swiss pharmaceutical company Novartis (NVS), London-based drugmaker AstraZeneca (AZN), Danish diabetes care leader Novo Nordisk (NVO) and
The list of about 125 total holdings is a global "who's who" of the industry. While this will add geographic diversification, it doesn't introduce additional risk given the large and established nature of these stocks.
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ARK Genomic Revolution ETF
- Assets under management: $1.1 billion
- Dividend yield: 0.00%
- Expenses: 0.75%
The ARK Genomic Revolution ETF (ARKG, $23.98) is smaller than many of the other best healthcare ETFs featured here, in terms of its assets under management as well as the number of components.
As the name suggests, this is a laser-focused healthcare fund that’s only concerned with companies doing cutting-edge research on gene therapies and other related healthcare technology.
The fund currently includes just 35 names, but that shouldn't be much of a surprise given its specialization.
Top holdings include Nvidia (NVDA)-backed Recursion Pharmaceuticals (RXRX), a leader in the AI-enabled drug discovery space, and synthetic RNA and DNA manufacturer Twist Bioscience (TWST) as well as CRISPR and chemical simulation software company Schrödinger (SDGR)
You may not have heard of any of these stocks, but they are among the most dynamic healthcare companies out there right now.
Of course, many of the healthcare stocks included in ARKG are also among the most volatile. ARKG slumped nearly 54% in 2022 but gained 16% in 2023. It was back in the red in 2024, down 28%. It's basically flat so far in 2025, though.
Buyers of this healthcare ETF should be aware of this additional risk, but if you're not afraid of performance like this during tough times in pursuit of significant gains when things go well, this is an aggressive fund worth considering.
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First Trust Health Care AlphaDEX Fund
- Assets under management: $1.0 billion
- Dividend yield: 0.4%
- Expenses: 0.60%
The approach of the First Trust Health Care AlphaDEX Fund (FXH, $106.20) is unique in that it takes an "enhanced" approach to exchange-traded funds.
In other words, FXH starts with the healthcare stocks in the Russell 1000 Index and then hand-picks the stocks it ranks highest based on measures such as sales growth, share price momentum and book value.
It then weights those picks based on how well they rank, theoretically biasing the fund toward the very best healthcare stocks out there right now.
FXH rebalances quarterly to ensure it's keeping up with Wall Street. Right now, that adds up to about 80 total names.
Leaders include biopharmaceutical royalties buyer Royalty Pharma (RPRX), online medical professional networking service Doximity (DOCS) and Intra-Cellular Therapies (ITCI), which develops small-molecule treatments for psychiatric and neurologic diseases.
FXH is the smallest of the healthcare ETFs on this list, though it is still decent in size with about $1 billion in total assets under management.
That means investors can buy into it with confidence unlike some of the smaller and less established funds out there.
Learn more about FXH at the First Trust provider site.
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