3 Healthcare Mutual Funds Standing Out Amid Mixed Labor Data

The combination of mixed U.S. employment data and decreased expectations about future Federal Reserve rate adjustments has put focus on defensive market segments. The U.S. Department of Labor released data that showed September 2025 payrolls increased by 119,000 while unemployment rates rose to 4.4% from 4.3% and hourly wages experienced a 0.2% increase. The effective federal funds rate at 3.88% during mid-November, which indicates that monetary policy continues to operate at a tight level.

In this scenario, the healthcare mutual fund sector is more attractive for investment because the healthcare sector performance remains stable against interest rate changes and market economic volatility. The U.S. Department of Labor shows that healthcare employment increased by 43,000 positions during September 2025, and year-over-year growth continues to trend above historical norms, with healthcare employment rising by roughly 498,000 jobs compared with August 2024, per the Bureau of Labor Statistics.

Healthcare companies maintain low beta values, which result in less market volatility for their stock prices during times of market uncertainty. Medical services operate with continuous cash flow because their core business operations protect them from economic recessions. The pharmaceutical industry maintains solid business performance during economic recessions because people require medications at the same level throughout all market conditions. Healthcare mutual funds function as protective investment options as market confidence starts to wane.

Thus, from an investment standpoint, we have selected three solid healthcare mutual funds, namely, Franklin Biotechnology Discovery Fund FBDIX, Fidelity Advisor Biotechnology Fund FBTIX and Janus Henderson Global Life Sciences Fund JNGLX for stable returns amid an economic downturn. Mutual funds, in general, reduce transaction costs and diversify portfolios without an array of commission charges that are mostly associated with stock purchases (read more: Mutual Funds: Advantages, Disadvantages, and How They Make Investors Money).

The selected mutual funds boast a Zacks Mutual Fund Rank #1 (Strong Buy) or 2 (Buy), have positive three-year and five-year annualized returns, minimum initial investments within $5000, and carry a low expense ratio.

Franklin Biotechnology Discovery Fund seeks capital appreciation. FBDIX invests most of its net assets in equity securities of biotechnology companies and discovery research firms.

Evan S. McCulloch has been the lead manager of FBDIX since Sept. 15, 1997. Most of the fund’s holdings were in companies like Gilead Sciences, Inc. (7.5%), Vertex Pharmaceuticals Inc (6.6%) and Amgen Inc. (5.8%) as of July 31, 2025.