What is the fee difference between VHT and XLV?

VHT has an expense ratio of 0.09% and XLV 0.08%, a difference of just 0.01 percentage points. On $10,000 invested that is about $9 a year for VHT and roughly $8 for XLV. The fee gap is close to negligible, so the choice between them comes down to how many stocks you want and how much concentration you accept.

What index does each fund track?

VHT tracks the MSCI US Investable Market Index 25/50 Health Care, which includes large, mid and small-cap US healthcare stocks, giving the fund 424 holdings. XLV tracks the S&P Health Care Select Sector index, which contains only the healthcare companies in the S&P 500, so it holds 63 large-cap stocks.

How much do VHT and XLV overlap?

The top of each fund is identical. All ten largest holdings are shared: Eli Lilly, Johnson & Johnson, AbbVie, Merck, UnitedHealth, Amgen, Thermo Fisher, Abbott, Gilead and Pfizer. XLV holds each at a larger weight because it has fewer stocks. The difference is the roughly 360 mid and small-cap names that VHT holds and XLV does not.

Which fund pays a higher dividend yield?

They are almost the same. XLV yields 1.50% and VHT yields 1.49%. Since both are dominated by the same large pharmaceutical and healthcare companies, their income profiles are nearly identical. Neither is an income fund; healthcare investors typically hold these for sector exposure rather than dividends.

Which fund suits which goal?

VHT suits investors who want the whole US healthcare sector, including smaller biotech and medical device companies that are not in the S&P 500. XLV suits investors who want the large-cap healthcare names only, in a very large and liquid fund. Because the top ten match, long-term results are driven mostly by the same companies.

How large and liquid are VHT and XLV?

XLV is larger at about $43.5 billion in net assets, compared with roughly $19 billion for VHT. Both are well established, with XLV launched in December 1998 and VHT in January 2004. Both trade with tight spreads for retail-sized orders; XLV's extra size mainly matters for large institutional trades and options.

Are there tax or account considerations?

Both are US-listed ETFs paying modest dividends of around 1.5%. Non-US investors may have US withholding tax applied to those payments, depending on treaty status. Capital gains treatment depends on your country and whether you use a taxable or tax-advantaged account. Check local guidance or speak to a tax professional.

Can I hold both VHT and XLV?

You can, but there is little point. The two funds share the same ten largest holdings, so owning both mainly doubles your exposure to Eli Lilly, Johnson & Johnson and AbbVie. If you want broader healthcare coverage, holding VHT alone already includes everything in XLV plus the smaller companies.

How concentrated is each fund?

XLV is more concentrated. Eli Lilly at 14.95% and Johnson & Johnson at 10.67% together exceed 25% of the fund, and its top ten is about 61%. VHT's top ten is roughly 51%, with Eli Lilly at 12.79%. Both are top-heavy sector funds; VHT simply spreads the remainder over hundreds of smaller stocks.

VHT vs XLV

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

VHT tracks the MSCI US IMI 25/50 Health Care index with 424 holdings for a 0.09% expense ratio, while XLV tracks the S&P Health Care Select Sector index with 63 holdings for 0.08%. Both list the same ten largest stocks, led by Eli Lilly at 12.79% in VHT and 14.95% in XLV. VHT suits investors who want small-cap biotech included; XLV suits large-cap-only exposure. Educational content, not financial advice.

VHT tracks the MSCI US IMI 25/50 Health Care index with 424 holdings for a 0.09% expense ratio, while XLV tracks the S&P Health Care Select Sector index with 63 holdings for 0.08%. Both list the same ...

Fund Snapshot

Key Fund Metrics

VHT

Metric

XLV

0.09%

Expense Ratio

0.08%

1.49%

Dividend Yield

1.50%

$19.11B

Net Assets

$43.50B

424

Holdings

63

Jan 26, 2004

Inception Date

Dec 16, 1998

MSCI US IMI 25/50 Health Care

Index Tracked

S&P Health Care Select Sector

Health

Fund Category

Equity

XLV costs about $1.00 less per year for every $10,000 invested.

Shared Top Holdings

Holding	VHT	XLV
LLYEli Lilly and Company	12.79%	14.95%
JNJJohnson & Johnson	8.72%	10.67%
ABBVAbbVie Inc.	6.26%	7.65%
MRKMerck & Co., Inc.	5.04%	5.96%
UNHUnitedHealth Group Incorporated	4.89%	5.59%
AMGNAmgen Inc.	3.21%	3.36%
TMOThermo Fisher Scientific Inc.	3.17%	4.01%
ABTAbbott Laboratories	2.66%	2.92%
GILDGilead Sciences, Inc.	2.51%	3.07%
PFEPfizer Inc.	2.24%	2.58%

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Investment Analysis

VHT

Pros

424 holdings span large, mid and small-cap healthcare, including smaller biotech
Lower single-stock concentration, with Eli Lilly at 12.79% versus 14.95% in XLV
Vanguard fund with a history back to January 2004

Considerations

Expense ratio of 0.09% is a touch above XLV's 0.08%
Smaller fund at about $19 billion in net assets compared with XLV's $43.5 billion
Small-cap biotech exposure can add volatility without changing the top-heavy profile

XLV

Pros

Expense ratio of 0.08%, about $8 a year per $10,000 invested
About $43.5 billion in net assets and trading history since December 1998
Pure large-cap exposure to the S&P 500 healthcare sector with 63 holdings

Considerations

Only 63 holdings, so no exposure to mid or small-cap healthcare companies
More concentrated, with Eli Lilly and Johnson & Johnson above 25% combined
Dividend yield of 1.50% is essentially the same as VHT's 1.49%

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About VHT and XLV

VHT (VHT)

XLV (XLV)

Health Care Select Sector SPDR (XLV) is an exchange‑traded fund that provides diversified exposure to large-cap US health‑care companies across pharmaceuticals, biotechnology, medical devices, health‑care providers and insurers. It trades like a stock, offering a simple way to gain sector-specific exposure without selecting individual companies. Investors should note sector concentration risk — performance is tied to regulatory decisions, patent cycles, drug approvals and healthcare spending trends. XLV typically offers broad, liquid exposure and may distribute dividends, but yields and performance fluctuate. Fees for passive sector ETFs are generally low compared with active funds, though expenses reduce long‑term returns. Suitable for investors seeking targeted allocation to the health‑care sector within a diversified portfolio, XLV is not a substitute for personalised advice. This is general educational information only — values can fall as well as rise and past performance is not a reliable indicator of future results.

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