Banking ETFs: How Do KBWB and FTXO Compare to Each Other?
Portfolio concentration and index strategy set these two banking ETFs apart for investors seeking sector exposure.
Banking ETFs: How Do KBWB and FTXO Compare to Each Other?
Overview
The Invesco KBW Bank ETF (NASDAQ:KBWB) offers a lower-cost entry into the banking sector with higher recent returns, while the First Trust Nasdaq Bank ETF (NASDAQ:FTXO) provides broader diversification.
Both funds target the domestic banking sector but follow different indexing methodologies to capture the industry performance. While the Invesco KBW Bank ETF tracks a market-cap-weighted index of money centers and regional banks, the First Trust Nasdaq Bank ETF uses a “smart” indexing approach focused on liquidity and fundamental factors such as volatility and growth.
Details
Beta measures price volatility relative to the S&P 500; beta is calculated from five-year monthly returns. The 1-yr return represents total return over the trailing 12 months. Dividend yield is the trailing-12-month distribution yield.
Source
Originally published at www.fool.com.
