Better Healthcare ETF: State Street's Pharmaceuticals-Focused XPH vs. Invesco's S&P 500-Targeted RSPH
Key Points
The Invesco S&P 500 Equal Weight Health Care ETF provides broad exposure to the sector, while the State Street SPDR S&P Pharmaceuticals ETF focuses specifically on the pharmaceutical industry.
The State Street SPDR S&P Pharmaceuticals ETF has significantly outperformed over the last year, though it carries higher concentration risk and historical volatility.
The Invesco S&P 500 Equal Weight Health Care ETF carries a slightly higher expense ratio and a higher beta, but it experienced a shallower maximum drawdown over the last five years.
The State Street SPDR S&P Pharmaceuticals ETF (NYSEMKT:XPH) and the Invesco S&P 500 Equal Weight Health Care ETF (NYSEMKT:RSPH) offer distinct approaches to the healthcare sector, differing in industry focus, weighting methodology, and recent total returns.
While the Invesco fund equal-weights its holdings across the broad healthcare sector to reduce the influence of massive market-cap leaders, the State Street fund targets the specific sub-sector of pharmaceuticals. This comparison looks at how these differing strategies affect costs, risks, and performance for long-term investors.
Snapshot (cost & size)
| Metric | XPH | RSPH |
|---|---|---|
| Issuer | State Street | Invesco |
| Share price | $70.11 (as of 2026-08-10) | $36.01 (as of 2026-08-10) |
| Expense ratio | 0.35% | 0.4% |
| 1-yr return (as of 2026-08-10) | 63.4% | 28.2% |
| Dividend yield | 0.5% | 0.6% |
| Beta | 0.59 | 0.78 |
| AUM | $519.4 million | $792.6 million |
Beta measures price volatility relative to the S&P 500; beta is calculated from monthly returns over the available fund history (up to five years). The 1-year return represents total return over the trailing 12 months. Dividend yield is the trailing-12-month distribution yield.
The State Street fund is slightly more affordable with an expense ratio of 0.35%, compared to 0.4% for the Invesco fund. While both funds pay dividends, the Invesco fund currently offers a slightly higher yield for income-focused investors.
Performance & risk comparison
| Metric | XPH | RSPH |
|---|---|---|
| Max drawdown (5 yr) | (30.9%) | (22.0%) |
| Growth of $1,000 over 5 years (total return) | $1,518 | $1,222 |
What's inside
The Invesco S&P 500 Equal Weight Health Care ETF tracks the S&P 500 Equal Weight Health Care Index, maintaining a portfolio of 60 holdings. Its sector exposure is 98% healthcare and 2% technology, using an equal-weighting scheme to minimize concentration. Its largest positions include Charles River Laboratories International(NYSE:CRL) at 2.18%, Veeva Systems (NYSE:VEEV) at 2.13%, and Bio-Techne Corp (NASDAQ:TECH) at 2.09%. The fund was launched in 2006. The Invesco S&P 500 Equal Weight Health Care ETF has paid $0.23 per share over the trailing 12 months, which on its recent ~$36.01 share price works out to a 0.6% yield.
The State Street SPDR S&P Pharmaceuticals ETF tracks the S&P Pharmaceuticals Select Industry Index and holds 65 stocks. It is 100% focused on the healthcare sector, specifically targeting the pharmaceutical and biotechnology industries. Its largest positions include Crinetics Pharmaceuticals(NASDAQ:CRNX) at 3.58%, MBX Biosciences(NASDAQ:MBX) at 3.20%, and Definium Therapeutics(NASDAQ:DFTX) at 2.90%. The fund was launched in 2006. The State Street SPDR S&P Pharmaceuticals ETF has paid $0.34 per share over the trailing 12 months, which on its recent ~$70.11 share price works out to a 0.5% yield.
For more guidance on ETF investing, check out the full guide at this link.
Which looks like the better buy
The State Street SPDR S&P Pharmaceuticals ETF (XPH) and Invesco S&P 500 Equal Weight Health Care ETF (RSPH) offer investors different types of exposure to the healthcare industry. Choosing which to invest in depends on your individual goals, and what makes sense for your portfolio.
XPH is for those who want to focus on the pharmaceuticals sub-sector within healthcare. The advantages to this is the fund’s stronger one-year and five-year returns. Its equal-weighting approach means no one stock dominates the ETF’s performance.
However, XPH is vulnerable to downturns in the pharmaceuticals industry, such as from the impact of regulatory or clinical setbacks. Consequently, this can be a good ETF to complement a more expansive healthcare portfolio.
RSPH provides broad exposure to a variety of healthcare enterprises, which includes pharmaceuticals as well. If you don’t have stocks in the sector, this is a well-rounded ETF to start with, since you gain a cross-section of the biggest businesses in the industry thanks to its focus on S&P 500 companies. It also uses an equal-weighting methodology, although a downside is that it charges a higher expense ratio.
Robert Izquierdo has no position in any of the stocks mentioned. The Motley Fool has positions in and recommends Veeva Systems. The Motley Fool has a disclosure policy.