Should You Invest in the Vanguard Health Care ETF (VHT)?

Core Viewpoint - The Vanguard Health Care ETF (VHT) is a passively managed ETF that provides broad exposure to the healthcare sector, appealing to both retail and institutional investors due to its low costs, transparency, flexibility, and tax efficiency [1][3]. Fund Overview - VHT was launched on January 26, 2004, and has accumulated over $14.94 billion in assets, making it one of the largest ETFs in the healthcare sector [3]. - The ETF aims to match the performance of the MSCI US Investable Market Health Care 25/50 Index, which includes stocks of U.S. companies in the healthcare sector [3]. Cost Structure - The annual operating expenses for VHT are 0.09%, positioning it as one of the least expensive options in the market [4]. - The ETF has a 12-month trailing dividend yield of 1.65% [4]. Sector Exposure and Holdings - VHT offers nearly 100% allocation in the healthcare sector, with Eli Lilly & Co (LLY) making up approximately 11.05% of total assets, followed by UnitedHealth Group Inc (UNH) and AbbVie Inc (ABBV) [5]. Performance Metrics - Year-to-date, VHT has experienced a loss of about 4.02%, and it is down approximately 9.09% over the last 12 months as of August 7, 2025 [6]. - The ETF has traded between $236.71 and $288.1 in the past 52 weeks, with a beta of 0.65 and a standard deviation of 14.28% over the trailing three-year period, indicating medium risk [6]. Investment Alternatives - VHT holds a Zacks ETF Rank of 1 (Strong Buy), based on expected asset class return, expense ratio, and momentum, making it a strong option for investors seeking healthcare sector exposure [7]. - Other alternatives include the iShares Global Healthcare ETF (IXJ) and the Health Care Select Sector SPDR ETF (XLV), with IXJ having $3.63 billion in assets and XLV having $32.12 billion [8][9].