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Should You Invest in the Fidelity MSCI Health Care Index ETF (FHLC)?
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The Fidelity MSCI Health Care Index ETF (FHLC - Free Report) was launched on 10/21/2013, and is a passively managed exchange traded fund designed to offer broad exposure to the Healthcare - Broad segment of the equity market.
An increasingly popular option among retail and institutional investors, passively managed ETFs offer low costs, transparency, flexibility, and tax efficiency; they are also excellent vehicles for long term investors.
Investor-friendly, sector ETFs provide many options to gain low risk and diversified exposure to a broad group of companies in particular sectors. Healthcare - Broad is one of the 16 broad Zacks sectors within the Zacks Industry classification. It is currently ranked 5, placing it in top 31%.
Index Details
The fund is sponsored by Fidelity. It has amassed assets over $2.95 billion, making it one of the larger ETFs attempting to match the performance of the Healthcare - Broad segment of the equity market. FHLC seeks to match the performance of the MSCI USA IMI Health Care Index before fees and expenses.
The MSCI USA IMI Health Care 25/50 Index represents the performance of the health care sector in the U.S. equity market.
Costs
When considering an ETF's total return, expense ratios are an important factor, and cheaper funds can significantly outperform their more expensive counterparts in the long term if all other factors remain equal.
Annual operating expenses for this ETF are 0.08%, making it the least expensive product in the space.
It has a 12-month trailing dividend yield of 1.31%.
Sector Exposure and Top Holdings
It is important to delve into an ETF's holdings before investing despite the many upsides to these kinds of funds like diversified exposure, which minimizes single stock risk. And, most ETFs are very transparent products that disclose their holdings on a daily basis.
This ETF has heaviest allocation in the Healthcare sector--about 100% of the portfolio.
Looking at individual holdings, Eli Lilly + Co Common Stock (LLY - Free Report) accounts for about 10.98% of total assets, followed by Unitedhealth Group Inc Common Stock Usd.01 (UNH - Free Report) and Johnson + Johnson Common Stock Usd1.0 (JNJ - Free Report) .
The top 10 holdings account for about 49.90% of total assets under management.
Performance and Risk
So far this year, FHLC return is roughly 13.29%, and was up about 21.01% in the last one year (as of 10/21/2024). During this past 52-week period, the fund has traded between $57.52 and $74.23.
The ETF has a beta of 0.70 and standard deviation of 14.75% for the trailing three-year period, making it a medium risk choice in the space. With about 368 holdings, it effectively diversifies company-specific risk.
Alternatives
Fidelity MSCI Health Care Index ETF carries a Zacks ETF Rank of 3 (Hold), which is based on expected asset class return, expense ratio, and momentum, among other factors. Thus, FHLC is a reasonable option for those seeking exposure to the Health Care ETFs area of the market. Investors might also want to consider some other ETF options in the space.
Vanguard Health Care ETF (VHT - Free Report) tracks MSCI US Investable Market Health Care 25/50 Index and the Health Care Select Sector SPDR ETF (XLV - Free Report) tracks Health Care Select Sector Index. Vanguard Health Care ETF has $18.48 billion in assets, Health Care Select Sector SPDR ETF has $41.53 billion. VHT has an expense ratio of 0.10% and XLV charges 0.09%.
Bottom Line
To learn more about this product and other ETFs, screen for products that match your investment objectives and read articles on latest developments in the ETF investing universe, please visit Zacks ETF Center.
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Should You Invest in the Fidelity MSCI Health Care Index ETF (FHLC)?
The Fidelity MSCI Health Care Index ETF (FHLC - Free Report) was launched on 10/21/2013, and is a passively managed exchange traded fund designed to offer broad exposure to the Healthcare - Broad segment of the equity market.
An increasingly popular option among retail and institutional investors, passively managed ETFs offer low costs, transparency, flexibility, and tax efficiency; they are also excellent vehicles for long term investors.
Investor-friendly, sector ETFs provide many options to gain low risk and diversified exposure to a broad group of companies in particular sectors. Healthcare - Broad is one of the 16 broad Zacks sectors within the Zacks Industry classification. It is currently ranked 5, placing it in top 31%.
Index Details
The fund is sponsored by Fidelity. It has amassed assets over $2.95 billion, making it one of the larger ETFs attempting to match the performance of the Healthcare - Broad segment of the equity market. FHLC seeks to match the performance of the MSCI USA IMI Health Care Index before fees and expenses.
The MSCI USA IMI Health Care 25/50 Index represents the performance of the health care sector in the U.S. equity market.
Costs
When considering an ETF's total return, expense ratios are an important factor, and cheaper funds can significantly outperform their more expensive counterparts in the long term if all other factors remain equal.
Annual operating expenses for this ETF are 0.08%, making it the least expensive product in the space.
It has a 12-month trailing dividend yield of 1.31%.
Sector Exposure and Top Holdings
It is important to delve into an ETF's holdings before investing despite the many upsides to these kinds of funds like diversified exposure, which minimizes single stock risk. And, most ETFs are very transparent products that disclose their holdings on a daily basis.
This ETF has heaviest allocation in the Healthcare sector--about 100% of the portfolio.
Looking at individual holdings, Eli Lilly + Co Common Stock (LLY - Free Report) accounts for about 10.98% of total assets, followed by Unitedhealth Group Inc Common Stock Usd.01 (UNH - Free Report) and Johnson + Johnson Common Stock Usd1.0 (JNJ - Free Report) .
The top 10 holdings account for about 49.90% of total assets under management.
Performance and Risk
So far this year, FHLC return is roughly 13.29%, and was up about 21.01% in the last one year (as of 10/21/2024). During this past 52-week period, the fund has traded between $57.52 and $74.23.
The ETF has a beta of 0.70 and standard deviation of 14.75% for the trailing three-year period, making it a medium risk choice in the space. With about 368 holdings, it effectively diversifies company-specific risk.
Alternatives
Fidelity MSCI Health Care Index ETF carries a Zacks ETF Rank of 3 (Hold), which is based on expected asset class return, expense ratio, and momentum, among other factors. Thus, FHLC is a reasonable option for those seeking exposure to the Health Care ETFs area of the market. Investors might also want to consider some other ETF options in the space.
Vanguard Health Care ETF (VHT - Free Report) tracks MSCI US Investable Market Health Care 25/50 Index and the Health Care Select Sector SPDR ETF (XLV - Free Report) tracks Health Care Select Sector Index. Vanguard Health Care ETF has $18.48 billion in assets, Health Care Select Sector SPDR ETF has $41.53 billion. VHT has an expense ratio of 0.10% and XLV charges 0.09%.
Bottom Line
To learn more about this product and other ETFs, screen for products that match your investment objectives and read articles on latest developments in the ETF investing universe, please visit Zacks ETF Center.