FTXH vs IHE

FTXHBFirst Trust Nasdaq Pharmaceuticals ETF

IHEBiShares U.S. Pharmaceuticals ETF

In short

FTXH Most pharma funds just size positions by market cap. FTXH screens US pharma stocks for liquidity, then ranks and weights them on value, momentum and profitability, so the biggest drugmaker isn't automatically the biggest holding.

IHE The domestic purist of pharma funds: about 60 US drug and vaccine makers, weighted by size, no foreign names riding along. Running since 2006, it is the plain cap-weighted take on Big Pharma.

Stated mandate

FTXH The fund seeks returns broadly matching the price and yield of the Nasdaq US Smart PharmaceuticalsTM Index before expenses. It uses an indexing approach intended to replicate that index’s holdings and weights, targeting 95% correlation, without assuring success.

IHE The fund seeks to track an index of U.S. companies in the pharmaceuticals sector, giving investors targeted exposure to domestic drug manufacturers and vaccine producers.

Why people hold it

• FTXH Weights follow a factor scorecard (value, momentum, profitability) rather than company size, a different recipe from the plain cap-weighted pharma funds it sits beside.ftportfolios.com
• Stays in its lane: US pharmaceutical companies, not a broad health care blend of biotech, device makers and insurers.ftportfolios.com
• Live since 2016 with a few hundred million in assets, it changes hands actively and pays distributions quarterly.
• Index replication is the whole job here, and the fund has kept close to the Nasdaq US Smart Pharmaceuticals Index it advertises.ftportfolios.com

• IHE Costs 0.37% a year against a 0.57% median for pharma funds, landing within a basis point or two of the cheapest options in the group.
• Tracks the Dow Jones U.S. Select Pharmaceuticals Index: domestic drug and vaccine makers only, not the US-listed foreign pharma that PPH's index also picks up.vaneck.com
• Trading since 2006 under the iShares banner, now a billion-dollar-plus fund with moderate daily volume and quarterly distributions.
• Sits in the upper half of its pharma peer group on our review, one of the sturdier implementations of a simple, cheap, index-following mandate.

Worth knowing

• FTXH The screen costs money: 0.60% a year, above the pharma-ETF median and well above cap-weighted rivals PPH (0.36%) and XPH (0.35%).
• About 50 names in a single sector. Patent rulings, trial results and drug-pricing headlines land with full force.
• Factor weighting cuts both ways: the lineup can look quite different from a standard cap-weighted pharma benchmark, and behave differently too.

• IHE Cap weighting across about 60 names puts the largest US drug makers in the driver's seat; XPH uses modified equal weight to spread dollars across large, mid and small caps.ssga.com
• Pharma only. No biotech, devices or insurers, and the fund is non-diversified, making it a narrow slice of health care.ishares.com
• The 0.37% fee undercuts the category median but not the floor: XPH at 0.35% and PPH at 0.36% shade it slightly.

Full FTXH profile⁠

Full IHE profile⁠