Investors often rely on the healthcare sector to safeguard their investments. This is because the demand for healthcare services does not vary too much with respect to market conditions, and thus, the sector offers sufficient protection to the capital invested. Many pharmaceutical companies also offer regular dividends. Companies that consistently pay out dividends are financially stable and generate steady cash flows, irrespective of market conditions. Mutual funds are the perfect choice for investors looking to enter this sector since they possess the advantages of wide diversification and analytical insight.
Below, we share with you three top-ranked Healthcare mutual funds, namely Fidelity Select Health Care FSPHX, Vanguard Health Care Fund VGHCX and Fidelity Advisor Biotechnology Fund FBTIX. Each has earned a Zacks Mutual Fund Rank #1 (Strong Buy) and is expected to outperform its peers in the future. Investors can click here to see the complete list of funds.
Fidelity Select Health Care focuses on global healthcare stocks, investing in companies providing medical products or services. FSPHX advisors use fundamental analysis to evaluate financial strength, industry position and market conditions, while maintaining a non-diversified portfolio.
Fidelity Select Health Care has three-year annualized returns of 6.8%. As of November 2025, FSPHX held 121 issues, with 6.5% of its assets invested in Boston Scientific.
Vanguard Health Care Fund primarily invests in companies involved in healthcare products and services, including pharmaceutical manufacturers, medical equipment suppliers, hospitals and research organizations. The fund may also invest significantly in foreign stocks, and it follows a non-diversified investment strategy focused on the healthcare sector.
Vanguard Health Care Fund has three-year annualized returns of 6.9%. VGHCX has an expense ratio of 0.33%.
Fidelity Advisor Biotechnology Fund focuses on biotech-related stocks worldwide, targeting firms driving scientific and technological advances, using fundamental analysis to assess financial strength, industry position and broader market conditions, while maintaining a non-diversified portfolio.
Fidelity Advisor Biotechnology Fund has three-year annualized returns of 18%. Eirene Kontopoulos has been the fund manager of FBTIX since July 2018.
To view the Zacks Rank and the past performance of all Healthcare mutual funds, investors can click here to see the complete list of healthcare mutual funds.
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This article originally published on Zacks Investment Research (zacks.com).
The views and opinions expressed herein are the views and opinions of the author and do not necessarily reflect those of Nasdaq, Inc.
