What is the main difference between IXJ and VHT in terms of investment exposure?

The primary distinction lies in geographic focus. IXJ, the iShares Global Healthcare ETF, provides global healthcare exposure, meaning it invests in companies from around the world. In contrast, VHT, the Health Care Vanguard ETF, is US-centric, focusing exclusively on the United States healthcare sector. Investors choosing between these two should consider whether they prefer international diversification or specific exposure to the US market. This fundamental difference drives their portfolio construction and risk profiles, rather than just their fees or size.

How do the expense ratios of IXJ and VHT compare, and why does it matter?

IXJ has an expense ratio of 0.38%, while VHT is significantly lower at 0.09%. This 0.29% difference may seem small annually, but over long investment horizons, fees compound and reduce net returns. For example, on a $10,000 investment, the annual fee difference is $29. Beginners should note that lower costs, all else being equal, generally provide a better foundation for long-term wealth accumulation, as less money is diverted from the investor's account to fund management costs.

Why are sector weights listed as 'not available' for both funds?

For both IXJ and VHT, the sector weight data is marked as 'not available' in the provided source. This means we cannot compare the precise sub-sector allocations, such as the balance between biotechnology, pharmaceuticals, or healthcare equipment providers. While top holdings overlap significantly, the lack of detailed sector weights limits transparency regarding how diversified each fund is within the broader healthcare industry. Investors relying on sector rotation strategies should seek additional data sources to understand these nuances.

How similar are the top 10 holdings of IXJ and VHT?

Despite different geographic mandates, the top ten holdings are identical for both IXJ and VHT. They include major US-based companies like Eli Lilly (LLY), Johnson & Johnson (JNJ), and AbbVie (ABBV). However, the weightings differ slightly. For instance, LLY makes up 10.38% of IXJ and 12.79% of VHT. This high overlap suggests that the performance of both funds is heavily driven by these large-cap US innovators, although IXJ’s global focus might introduce other companies outside the top ten.

Which fund offers a higher dividend yield and what does this indicate?

VHT offers a dividend yield of 1.49%, which is slightly higher than IXJ's 1.40%. This suggests that the underlying companies in VHT’s portfolio, or the fund's distribution policy, currently generate marginally more income for investors. A higher yield can be attractive for income-focused investors, but it is essential to remember that yields fluctuate with share price and dividend changes. Both yields are modest, typical for growth-oriented healthcare sectors where companies may reinvest profits rather than distribute large dividends.

How does the net asset size of each fund impact potential trading liquidity?

VHT is a much larger fund with $19.1 billion in net assets, compared to IXJ's $4.3 billion. Generally, larger asset bases correlate with higher trading volumes and tighter bid-ask spreads, enhancing liquidity for investors entering or exiting positions. While IXJ is still a substantial fund with billions in assets, the significant size difference might result in slightly less efficient trading conditions for IXJ. Beginners should be aware that liquidity affects the ease and cost of transactions, though this is less critical for long-term holders.

What is the significance of the inception dates for IXJ and VHT?

IXJ was established in November 2001, making it an older fund with over two decades of history, whereas VHT was launched in January 2004. A longer track record can provide more historical data for backtesting, but it also means the fund has survived multiple market cycles. The three-year difference is minimal in the grand scheme of investing. However, it indicates that IXJ has been providing global healthcare exposure slightly longer, potentially offering a broader historical context for comparing performance across various market environments.

How do concentration risks compare between the two healthcare ETFs?

Both funds exhibit concentration in their top holdings, particularly in US pharmaceutical giants. VHT shows higher concentration in its top names, with LLY at 12.79% and JNJ at 8.72%, compared to IXJ's 10.38% and 7.32%. This means VHT’s performance may be more sensitive to the news or earnings of these specific US companies. While IXJ also holds these stocks, its global mandate theoretically dilutes this concentration by including international healthcare firms, though the top US holdings remain dominant in both portfolios.

For a beginner seeking global diversification, which fund structure is more suitable?

IXJ is designed for global healthcare exposure, making it structurally more suitable for investors seeking to diversify beyond the US market. VHT is US-centric, offering concentrated access to the world's largest healthcare market. Neither fund is universally 'better'; they serve different strategic goals. A beginner prioritising international diversification within the healthcare sector would look at IXJ, whereas one confident in the US market's dominance might prefer VHT's lower costs and straightforward US focus. Understanding this geographic distinction is key to fitting the ETF into a broader portfolio.

What should investors consider regarding index methodology for these ETFs?

The index tracked for both IXJ and VHT is listed as 'not available' in the provided data. Without knowing the specific index methodology, investors cannot fully understand the criteria used for selecting and weighting holdings, such as market cap thresholds or liquidity screens. This lack of transparency means one must rely on the current holdings and fund factsheets. For practical purposes, investors should monitor official fund documentation for updates on methodology, as it directly influences how the ETF replicates the healthcare market's performance.

IXJ vs VHT

Two funds, one decision: we compare cost, performance and what each ETF actually holds in October 2026.

This page compares the iShares Global Healthcare ETF (IXJ) and the Health Care Vanguard ETF (VHT). We examine fees, holdings, dividends and how each fund tracks its market. The expense ratio for IXJ is 0.38% and for VHT is 0.09%. Index focus details are not available for either fund. Educational content, not financial advice.

Fund Snapshot

Key Fund Metrics

IXJ

Metric

VHT

0.38%

Expense Ratio

0.09%

1.40%

Dividend Yield

1.49%

$4.32B

Net Assets

$19.11B

133

Holdings

424

Nov 13, 2001

Inception Date

Jan 26, 2004

–

Index Tracked

–

Health

Fund Category

Health

VHT costs about $29.00 less per year for every $10,000 invested.

Shared Top Holdings

Holding	IXJ	VHT
LLYEli Lilly and Company	10.38%	12.79%
JNJJohnson & Johnson	7.32%	8.72%
ABBVAbbVie Inc.	5.25%	6.26%
MRKMerck & Co., Inc.	4.48%	5.04%
UNHUnitedHealth Group Incorporated	4.18%	4.89%
TMOThermo Fisher Scientific Inc.	2.98%	3.17%
AMGNAmgen Inc.	2.58%	3.21%
GILDGilead Sciences, Inc.	2.31%	2.51%
ABTAbbott Laboratories	2.20%	2.66%
PFEPfizer Inc.	1.95%	2.24%

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Investment Analysis

IXJ

Pros

Provides global healthcare exposure with a dividend yield of 1.40%.
Established since November 2001 with net assets of $4.3 billion.
Diversified across sectors including biotechnology and pharmaceuticals.

Considerations

Higher expense ratio at 0.38% compared to similar funds.
Smaller net assets may impact trading liquidity and spreads.
Limited visibility on index methodology as sector weights are unavailable.

VHT

Pros

Low expense ratio of 0.09% enhances net returns.
Substantial net assets of $19.1 billion support liquidity.
Higher dividend yield at 1.49% benefits income investors.

Considerations

US-centric focus may lack global diversification.
Concentration in top holdings like LLY and JNJ.
Unavailable sector weights obscure portfolio composition details.

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About IXJ and VHT

IXJ (IXJ)

The iShares Global Healthcare ETF (IXJ) provides investors with broad exposure to the global healthcare sector. This fund tracks an index of healthcare companies across developed and emerging markets, offering a diversified way to invest in pharmaceuticals, biotechnology, and medical devices. With 133 holdings and net assets of USD 4.32 billion, IXJ allows investors to tap into the demographic tailwinds driving healthcare demand worldwide. The fund has an expense ratio of 0.38% and a dividend yield of 1.40%, making it a potentially income-generating component of a diversified portfolio. However, it is important to remember that the healthcare sector can be volatile due to regulatory changes, drug development risks, and market fluctuations. Past performance is not a reliable indicator of future results, and the value of investments can fall as well as rise.

VHT (VHT)

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IXJ vs VHT

Fund Snapshot