Blue-Chip Stability or Concentrated Food Bets?

• IYK offers a lower expense ratio and higher dividend yield than PBJ.

• IYK has delivered stronger one-year total returns and similar risk metrics compared to PBJ.

• PBJ is more concentrated in food and beverage names, while IYK covers a broader range of consumer staples and includes a notable healthcare allocation.

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Invesco Food & Beverage ETF (NYSEMKT:PBJ) and iShares US Consumer Staples ETF (NYSEMKT:IYK) differ most on cost, yield, and sector breadth—with IYK charging less, paying a higher dividend, and holding a wider mix of consumer names.

Both ETFs target U.S. companies in the defensive consumer space, but their approaches and exposures diverge. This comparison explores how each fund’s fees, returns, holdings, and risk profiles stack up for investors considering a focused food and beverage play versus a broader consumer staples allocation.

The 1-yr return represents total return over the trailing 12 months.

IYK comes in more affordable on fees and delivers a higher payout, with a 0.38% expense ratio and 2.6% yield compared to PBJ’s 0.61% and 1.8%, respectively.

IYK tracks U.S. consumer staples, holding 54 stocks with a tilt toward large, household names. Its portfolio is 84% consumer defensive and 12% healthcare, with top positions in Procter & Gamble (NYSE:PG), Coca-Cola (NYSE:KO), and Philip Morris International (NYSE:PM). The fund is seasoned at 25.6 years, offering broad exposure across consumer essentials and a modest allocation to healthcare.

PBJ, on the other hand, is almost entirely focused on food and beverage companies, with 89% in consumer defensive, 5% in basic materials, and 3% in consumer cyclicals. Its top holdings—Monster Beverage (NASDAQ:MNST), Corteva (NYSE:CTVA), and The Hershey Co (NYSE:HSY)—reflect this narrower industry slice. PBJ’s approach may appeal to those seeking more targeted exposure to food-related trends.

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

IYK and PBJ both invest in consumer staples — the everyday essentials people buy regardless of economic conditions. In times of market uncertainty, these stocks often hold their value better than growth sectors because demand stays steady, and they provide that “sleep well at night” quality. But here’s the key difference: IYK takes a broad, blue-chip approach while PBJ focuses specifically on food and beverage companies.

There’s a striking performance gap between these ETFs. IYK delivered around 7.7% in 2025, significantly outperforming PBJ’s roughly flat year. IYK’s broader diversification, which includes 12% in healthcare stocks, helped it weather sector-specific headwinds. PBJ’s concentrated food and beverage focus left it exposed to rising ingredient costs and consumer shifts toward cheaper private-label brands. The expense ratio difference compounds this: IYK charges 0.38% versus PBJ’s 0.61%, while IYK’s 2.6% dividend yield beats PBJ’s 1.8%.

If you want to build a defensive core holding, IYK makes the most sense here. It’s the straightforward choice for investors who want broad exposure to everyday essentials without betting on any specific industry. The higher dividend also provides steady income. Opt for PBJ only if you have strong conviction that food and beverage companies will outperform the broader consumer staples sector and can justify paying nearly double the fees for that concentrated bet.

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Sara Appino has no position in any of the stocks mentioned. The Motley Fool has positions in and recommends Hershey and Monster Beverage. The Motley Fool recommends Philip Morris International. The Motley Fool has a disclosure policy.

IYK vs. PBJ: Blue-Chip Stability or Concentrated Food Bets? was originally published by The Motley Fool