Designed to provide broad exposure to the Healthcare - Broad segment of the equity market, the Fidelity MSCI Health Care Index ETF (FHLC) is a passively managed exchange traded fund launched on October 21, 2013.
Passively managed ETFs are becoming increasingly popular with institutional as well as retail investors due to their low cost, transparency, flexibility and tax efficiency. They are excellent vehicles for long term investors.
Sector ETFs are also funds of convenience, offering many ways 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 10, placing it in bottom 38%.
Index Details
The fund is sponsored by Fidelity. It has amassed assets over $3.29 billion, making it one of the largest 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
Expense ratios are an important factor in the return of an ETF and in the long term, cheaper funds can significantly outperform their more expensive counterparts, other things remaining the same.
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 1.3%.
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) accounts for about 14.14% of total assets, followed by Johnson + Johnson Common Stock Usd1.0 (JNJ) and Abbvie Inc Common Stock Usd.01 (ABBV).The top 10 holdings account for about 52.12% of total assets under management.
Performance and Risk
The ETF has added about 6.28% so far this year and is up about 23.9% in the last one year (as of 07/14/2026). In that past 52-week period, it has traded between $61.56 and $80.15.
The ETF has a beta of 0.60 and standard deviation of 14.05% for the trailing three-year period, making it a medium risk choice in the space. With about 344 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 sufficient 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 Index Fund ETF Shares (VHT) tracks MSCI US Investable Market Health Care 25/50 Index and the State Street Health Care Select Sector SPDR ETF ETF (XLV) tracks Health Care Select Sector Index. Vanguard Health Care Index Fund ETF Shares has $18.08 billion in assets, State Street Health Care Select Sector SPDR ETF ETF has $41.47 billion. VHT has an expense ratio of 0.09%, and XLV charges 0.08%.
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.
Boost Your Portfolio with Our Top ETF Insights
Zacks' exclusive Fund Newsletter delivers actionable information, top news and analysis, as well as top-performing ETFs, straight to your inbox every week.
Don’t miss out on this valuable resource. It’s free!
Get it now >>Want the latest recommendations from Zacks Investment Research? Today, you can download 7 Best Stocks for the Next 30 Days. Click to get this free report
Fidelity MSCI Health Care Index ETF (FHLC): ETF Research Reports
This article originally published on Zacks Investment Research (zacks.com).