TodaySunday, August 23, 2026

FHLC Vs. PJP: Two Healthcare ETFs With Very Different Risk And Reward Profiles

Investors looking to gain exposure to the healthcare sector have two notable options in the Fidelity MSCI Health Care Index ETF (NYSEMKT: FHLC) and the Invesco Pharmaceuticals ETF (NYSEMKT: PJP).

Both funds operate within the medical space, but their underlying strategies, costs, and risk profiles differ in ways that matter significantly for long-term investors.

FHLC carries a notably lower expense ratio of 0.08%, compared to PJP’s 0.57%, translating to $8 versus $57 annually per $10,000 invested.

That gap may appear modest at first glance, but it can compound into thousands of dollars in lost returns over the course of a long investment horizon.

FHLC also offers a higher dividend yield of 1.29%, versus 0.88% for PJP, making it more attractive to income-focused investors seeking consistent distributions.

On the performance side, PJP has delivered stronger returns, with a one-year total return of 44.4% compared to FHLC’s 31.3% as of August 22, 2026.

Over five years, a $1,000 investment in PJP would have grown to $1,679, while the same amount placed in FHLC would have reached $1,349 over the same period.

PJP achieves this by taking a concentrated approach, holding just 33 pharmaceutical stocks with top positions in Abbott Laboratories, Amgen, and AbbVie.

FHLC, by contrast, tracks a broad index of U.S. healthcare stocks with more than 300 holdings, including Eli Lilly, Johnson and Johnson, and AbbVie across the full sector.

This diversification is a key structural advantage for FHLC, as it reduces exposure to any single pharmaceutical subsector downturn or wave of industry-specific volatility.

PJP’s concentrated portfolio introduces more concentrated risk, even though its five-year max drawdown of 17.5% is only marginally better than FHLC’s 17.8% over the same window.

FHLC commands a much larger asset base, with $3.3 billion in assets under management compared to PJP’s $472 million, reflecting broader investor adoption.

FHLC was launched in 2013 and has paid $1.02 per share in dividends over the trailing 12 months, while PJP, launched in 2005, has paid $1.06 per share in that same period.

PJP also carries a lower beta of 0.47 versus FHLC’s 0.57, suggesting it has historically moved less in tandem with the broader S&P 500 index on a monthly basis.

Ultimately, investors who prioritize low fees, broad diversification, and a higher dividend yield will find FHLC to be the more cost-efficient and lower-risk choice for healthcare exposure.

Those willing to accept higher fees and a more concentrated pharmaceutical focus in exchange for stronger recent performance may find PJP a compelling complement to an existing portfolio.

Jordan Hayes

Jordan Hayes is a seasoned business reporter at iBusiness.News, specializing in market trends, corporate developments, and financial technology. With a keen eye for detail and a passion for breaking down complex business topics, Jordan delivers insightful coverage that keeps readers informed and ahead of the curve.

Before joining iBusiness.News, Jordan contributed to several financial publications, honing expertise in global markets and emerging industries.