Designed to provide broad exposure to the Healthcare - Healthcare - Providers segment of the equity market, the iShares U.S. Healthcare Providers ETF (IHF) is a passively managed exchange traded fund launched on 05/01/2006.
Retail and institutional investors increasingly turn to passively managed ETFs because they offer low costs, transparency, flexibility, and tax efficiency; these kind of funds are also excellent vehicles for long term investors.
Sector ETFs also provide investors access to a broad group of companies in particular sectors that offer low risk and diversified exposure. Healthcare - Healthcare - Providers is one of the 16 broad Zacks sectors within the Zacks Industry classification. It is currently ranked 4, placing it in top 25%.
Index Details
The fund is sponsored by Blackrock. It has amassed assets over $685 million, making it one of the larger ETFs attempting to match the performance of the Healthcare - Healthcare - Providers segment of the equity market. IHF seeks to match the performance of the Dow Jones U.S. Select HealthCare Providers Index before fees and expenses.
The Dow Jones U.S. Select HealthCare Providers Index is free-float adjusted market capitalization-weighted index. It measures the performance of the health care providers sub-sector of the U.S. equity market. It includes health maintenance organizations, hospitals, clinics, dentists, opticians, nursing homes rehabilitation & retirement centres.
Costs
Investors should also pay attention to an ETF's expense ratio. Lower cost products will produce better results than those with a higher cost, assuming all other metrics remain the same.
Annual operating expenses for this ETF are 0.40%, making it on par with most peer products in the space.
It has a 12-month trailing dividend yield of 0.76%.
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, Unitedhealth Group Inc (UNH) accounts for about 19.95% of total assets, followed by Elevance Health Inc (ELV) and Cigna (CI).
The top 10 holdings account for about 72.85% of total assets under management.
Performance and Risk
Year-to-date, the iShares U.S. Healthcare Providers ETF return is roughly 13.04% so far, and was up about 7.99% over the last 12 months (as of 04/16/2025). IHF has traded between $47.41 and $58.67 in this past 52-week period.
The ETF has a beta of 0.76 and standard deviation of 17.63% for the trailing three-year period, making it a medium risk choice in the space. With about 71 holdings, it effectively diversifies company-specific risk.
Alternatives
IShares U.S. Healthcare Providers 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, IHF 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.
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iShares U.S. Healthcare Providers ETF (IHF): ETF Research Reports UnitedHealth Group Incorporated (UNH): Free Stock Analysis Report Cigna Group (CI): Free Stock Analysis Report Elevance Health, Inc. (ELV): Free Stock Analysis ReportThis article originally published on Zacks Investment Research (zacks.com).
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