Which Is the Better Healthcare ETF, First Trust's Biotech-Focused FBT or State Street's Broader XLV?
FBT delivered 52.4% returns over one year but with deeper drawdowns, while XLV's diversified approach offers lower costs and steadier performance.
Overview
Investors choosing between the State Street Health Care Select Sector SPDR ETF (NYSEMKT:XLV) and First Trust NYSE Arca Biotechnology Index Fund (NYSEMKT:FBT) must weigh XLV's broad healthcare diversification and low cost against FBT's concentrated, high-growth biotechnology focus.
Both funds provide targeted exposure to the healthcare sector but differ significantly in scope. While XLV tracks the entire S&P 500 healthcare component, FBT zeros in on a specific equal-weighted basket of biotechnology companies. This comparison explores how these differing strategies impact cost, volatility, and long-term performance.
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.