Investors choosing between iShares Global Healthcare ETF (NYSEMKT:IXJ) and Invesco Nasdaq Biotechnology ETF (NASDAQ:IBBQ) may weigh broad global diversification and higher dividend yields against lower costs and specialized high-growth potential.

Both ETFs target the healthcare sector, but their geographic and industry scopes differ significantly. While one provides broad global exposure to medical giants, the other offers a focused play on the biotechnology and pharmaceutical innovation occurring on the Nasdaq. This analysis compares their costs, risk profiles, and recent performance.

Metric

IBBQ

IXJ

Issuer

Invesco

iShares

Share price

$32.04 (as of 2026-07-20)

$98.12 (as of 2026-07-20)

Expense ratio

0.19%

0.40%

1-yr return (as of July 20, 2026)

47.50%

18.30%

Dividend yield

0.80%

1.50%

Beta

0.60

0.56

AUM

$75.4 million

$4.0 billion

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-yr return represents total return over the trailing 12 months. Dividend yield is the trailing-12-month distribution yield as of the close of trading on July 20.

Cost-conscious investors may find the Invesco fund more affordable with its 0.19% expense ratio compared to 0.40% for the iShares fund. However, the iShares fund offers a higher payout for those seeking regular income from their healthcare holdings.

Metric

IBBQ

IXJ

Max drawdown (5 yr)

(38.00%)

(18.10%)

Growth of $1,000 over 5 years (total return)

$1,295

$1,243

iShares Global Healthcare ETF provides exposure to 110 pharmaceutical, biotechnology, and medical device companies across both developed and emerging markets. This global reach offers a broader lens than sub-sector funds. Its largest positions include Eli Lilly & Co (NYSE:LLY) at 10.9%, Johnson & Johnson (NYSE:JNJ) at 7%, and Abbvie (NYSE:ABBV) at 5.1%. It was launched in 2001. iShares Global Healthcare ETF has paid $1.44 per share over the trailing 12 months, which on its recent ~$98.12 share price works out to a 1.50% yield.

Invesco Nasdaq Biotechnology ETF tracks the Nasdaq Biotechnology Index, targeting 251 firms classified as biotechnology or pharmaceutical. The portfolio is more concentrated in high-growth medical innovations. Top holdings include  Vertex Pharmaceuticals (NASDAQ:VRTX) at 8.1%, Amgen (NASDAQ:AMGN) at 7.9%, and Gilead Sciences (NASDAQ:GILD) at 6.9%. It was launched in 2021. Invesco Nasdaq Biotechnology ETF has paid $0.26 per share over the trailing 12 months, which on its recent ~$32.04 share price works out to a 0.80% yield.

Both these funds offer access to global pharmaceutical companies at a similar expense ratio. But there are differences to take into account when considering whether to invest in one or the other.

IXJ, the iShares ETF, is about three-quarters focused on U.S. stocks, with nearly all the balance in developed, non-U.S. markets (1% of its holdings are in emerging markets). By comparison, IBBQ, the Invesco fund, it nearly all U.S. stocks, with 6% in developed and emerging markets.

IBBQ is much more weighted in small caps compared to IXJ, with 38% of its holdings in small caps compared to 1% for IXJ. IBBQ also has 36% of its stock holdings in mid caps, versus 16% for its iShares competitor.

So which fund is the better buy? The choice comes down to performance. IBBQ bests IXJ in every time frame back through the 5-year look-back. IBBQ has returned 15.3% to 2% year-to-date, 18% versus 6.6% for IXH in the past three years, and 5.7% to 4.9% in the 5-year time frame.

IXJ's much milder maximum drawdown and better dividend are reasons for investors more interested in stability to consider going with iShares here, but if long-term performance is your goal, the Invesco IBBQ ETF is the choice for 2026.

For more guidance on ETF investing, check out the full guide at this link.

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Brendan Coffey has no position in any of the stocks mentioned. The Motley Fool has no position in any of the stocks mentioned. The Motley Fool has a disclosure policy.

Is the iShares Healthcare ETF or the Invesco Nasdaq Biotech ETF the Better Bet for Investors in 2026? was originally published by The Motley Fool