Which Is the Better Healthcare ETF: Fidelity's Low-Cost FHLC or First Trust's High-Conviction FBT?
One fund offers broad sector exposure at 0.08% cost; the other concentrates on 30 biotech stocks with higher volatility but stronger recent returns.
Overview
Fidelity MSCI Health Care Index ETF (NYSEMKT:FHLC) offers broad healthcare exposure at a fraction of the cost, while First Trust NYSE Arca Biotechnology Index Fund (NYSEMKT:FBT) provides an aggressive, concentrated focus on biotechnology innovation.
Investors choosing between these funds must weigh the stability of a diversified healthcare portfolio against the growth potential and volatility of a niche biotechnology basket. While both target the medical space, the Fidelity fund provides a cheaper gateway to the broader industry, whereas FBT hones in on high-growth biotech firms.
Details
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.
Source
Originally published at www.fool.com.