3 Leading Healthcare Funds Poised for Significant Growth Potential

Healthcare Mutual Funds: A Reliable Investment Choice

The healthcare industry is often viewed as a safe haven for investors, as the need for medical services remains steady regardless of economic shifts. This stability helps protect invested capital, and many pharmaceutical firms also provide consistent dividend payouts. Companies with a track record of regular dividends are typically financially sound and maintain reliable cash flows, even during market volatility. For those interested in tapping into this sector, mutual funds offer an excellent entry point, thanks to their broad diversification and expert management.

Top Healthcare Mutual Funds to Consider

Here are three highly rated healthcare mutual funds that stand out for their performance and potential:

• Fidelity Select Health Care (FSPHX)
• Vanguard Health Care Fund (VGHCX)
• Fidelity Advisor Biotechnology Fund (FBTIX)

All three funds have achieved a Zacks Mutual Fund Rank #1 (Strong Buy), indicating strong prospects for outperforming their peers.

Fund Highlights

Fidelity Select Health Care (FSPHX): This fund invests in healthcare companies worldwide, focusing on those that provide medical products or services. The fund managers use in-depth analysis to assess financial health, industry standing, and market trends, while maintaining a concentrated portfolio. Over the past three years, FSPHX has delivered an average annual return of 6.8%. As of November 2025, it held 121 positions, with Boston Scientific accounting for 6.5% of assets.

Vanguard Health Care Fund (VGHCX): VGHCX targets firms involved in healthcare products and services, including drug manufacturers, medical device companies, hospitals, and research institutions. The fund may also invest in international stocks and follows a focused, non-diversified strategy within the healthcare sector. Its three-year average annual return stands at 6.9%, and it features a low expense ratio of 0.33%.

Fidelity Advisor Biotechnology Fund (FBTIX): FBTIX concentrates on biotechnology companies globally, seeking out firms at the forefront of scientific and technological innovation. The fund employs fundamental analysis to evaluate financial strength and industry position, maintaining a selective portfolio. Over the past three years, FBTIX has posted an impressive 18% average annual return. Eirene Kontopoulos has managed the fund since July 2018.