As Healthcare Rallies Is the Vanguard Health Care ETF of the Invesco Pharmaceuticals ETF the Better Fund for 2026?
PJP surged 45% in one year, but VHT's lower costs and higher dividend yield appeal to long-term income investors seeking broad sector exposure.
Overview
Vanguard Health Care ETF (NYSEMKT:VHT) and Invesco Pharmaceuticals ETF (NYSEMKT:PJP) differ primarily in scope and cost, as the Vanguard fund provides broad sector coverage for a fraction of the Invesco fund price.
Healthcare investors often choose between broad sector exposure and thematic niches. The Vanguard fund provides a wide net across the entire industry, whereas the Invesco fund targets the research and manufacturing segments of the U.S. drug market exclusively. The choice -- broad versus narrow -- impacts everything from volatility to income potential.
Details
VHT is significantly more affordable, sporting an expense ratio of 0.09% compared to 0.57% for PJP. The Vanguard fund also offers a higher payout, with a yield gap of 0.68 percentage points over its peer.
Source
Originally published at www.fool.com.