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Should You Invest in the iShares U.S. Pharmaceuticals ETF (IHE)?
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The iShares U.S. Pharmaceuticals ETF (IHE - Free Report) was launched on May 1, 2006, and is a passively managed exchange traded fund designed to offer broad exposure to the Healthcare - Pharma segment of the equity market.
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 also provide investors access to a broad group of companies in particular sectors that offer low risk and diversified exposure. Healthcare - Pharma is one of the 16 broad Zacks sectors within the Zacks Industry classification. It is currently ranked 6, placing it in top 38%.
Index Details
The fund is sponsored by Blackrock. It has amassed assets over $876.76 million, making it one of the larger ETFs attempting to match the performance of the Healthcare - Pharma segment of the equity market. IHE seeks to match the performance of the Dow Jones U.S. Select Pharmaceuticals Index before fees and expenses.
The Dow Jones U.S. Select Pharmaceuticals Index is free-float adjusted market capitalization-weighted index. It includes pharmaceutical companies such as manufacturers of prescription or over-the-counter drugs or vaccines, but excludes producers of vitamins.
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 0.38%, making it on par with most peer products in the space.
It has a 12-month trailing dividend yield of 1.7%.
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, Johnson & Johnson (JNJ) accounts for about 22.64% of total assets, followed by Eli Lilly (LLY) and Merck & Co Inc (MRK).
The top 10 holdings account for about 77.75% of total assets under management.
Performance and Risk
Year-to-date, the iShares U.S. Pharmaceuticals ETF has added roughly 3.4% so far, and is up roughly 37.43% over the last 12 months (as of 05/11/2026). IHE has traded between $62.06 and $91.84 in this past 52-week period.
The ETF has a beta of 0.49 and standard deviation of 16.13% for the trailing three-year period, making it a high risk choice in the space. With about 60 holdings, it effectively diversifies company-specific risk.
Alternatives
iShares U.S. Pharmaceuticals ETF holds a Zacks ETF Rank of 2 (Buy), which is based on expected asset class return, expense ratio, and momentum, among other factors. Because of this, IHE is a great option for investors seeking exposure to the Health Care ETFs segment of the market. There are other additional ETFs in the space that investors could consider as well.
State Street SPDR S&P Pharmaceuticals ETF (XPH) tracks S&P Pharmaceuticals Select Industry Index and the VanEck Pharmaceutical ETF (PPH) tracks MVIS US Listed Pharmaceutical 25 Index. State Street SPDR S&P Pharmaceuticals ETF has $364.93 million in assets, VanEck Pharmaceutical ETF has $921.97 million. XPH has an expense ratio of 0.35%, and PPH charges 0.36%.
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.
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Should You Invest in the iShares U.S. Pharmaceuticals ETF (IHE)?
The iShares U.S. Pharmaceuticals ETF (IHE - Free Report) was launched on May 1, 2006, and is a passively managed exchange traded fund designed to offer broad exposure to the Healthcare - Pharma segment of the equity market.
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 also provide investors access to a broad group of companies in particular sectors that offer low risk and diversified exposure. Healthcare - Pharma is one of the 16 broad Zacks sectors within the Zacks Industry classification. It is currently ranked 6, placing it in top 38%.
Index Details
The fund is sponsored by Blackrock. It has amassed assets over $876.76 million, making it one of the larger ETFs attempting to match the performance of the Healthcare - Pharma segment of the equity market. IHE seeks to match the performance of the Dow Jones U.S. Select Pharmaceuticals Index before fees and expenses.
The Dow Jones U.S. Select Pharmaceuticals Index is free-float adjusted market capitalization-weighted index. It includes pharmaceutical companies such as manufacturers of prescription or over-the-counter drugs or vaccines, but excludes producers of vitamins.
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 0.38%, making it on par with most peer products in the space.
It has a 12-month trailing dividend yield of 1.7%.
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, Johnson & Johnson (JNJ) accounts for about 22.64% of total assets, followed by Eli Lilly (LLY) and Merck & Co Inc (MRK).The top 10 holdings account for about 77.75% of total assets under management.
Performance and Risk
Year-to-date, the iShares U.S. Pharmaceuticals ETF has added roughly 3.4% so far, and is up roughly 37.43% over the last 12 months (as of 05/11/2026). IHE has traded between $62.06 and $91.84 in this past 52-week period.
The ETF has a beta of 0.49 and standard deviation of 16.13% for the trailing three-year period, making it a high risk choice in the space. With about 60 holdings, it effectively diversifies company-specific risk.
Alternatives
iShares U.S. Pharmaceuticals ETF holds a Zacks ETF Rank of 2 (Buy), which is based on expected asset class return, expense ratio, and momentum, among other factors. Because of this, IHE is a great option for investors seeking exposure to the Health Care ETFs segment of the market. There are other additional ETFs in the space that investors could consider as well.
State Street SPDR S&P Pharmaceuticals ETF (XPH) tracks S&P Pharmaceuticals Select Industry Index and the VanEck Pharmaceutical ETF (PPH) tracks MVIS US Listed Pharmaceutical 25 Index. State Street SPDR S&P Pharmaceuticals ETF has $364.93 million in assets, VanEck Pharmaceutical ETF has $921.97 million. XPH has an expense ratio of 0.35%, and PPH charges 0.36%.
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.