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Should You Invest in the VanEck Biotech ETF (BBH)?
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Looking for broad exposure to the Healthcare - Biotech segment of the equity market? You should consider the VanEck Biotech ETF (BBH - Free Report) , a passively managed exchange traded fund launched on 12/20/2011.
Passively managed ETFs are becoming increasingly popular with institutional as well as retail investors due to their low cost, transparency, flexibility and tax efficiency. They are excellent vehicles for long term investors.
Sector ETFs are also funds of convenience, offering many ways to gain low risk and diversified exposure to a broad group of companies in particular sectors. Healthcare - Biotech is one of the 16 broad Zacks sectors within the Zacks Industry classification. It is currently ranked 8, placing it in top 50%.
Index Details
The fund is sponsored by Van Eck. It has amassed assets over $486.42 million, making it one of the average sized ETFs attempting to match the performance of the Healthcare - Biotech segment of the equity market. BBH seeks to match the performance of the MVIS US Listed Biotech 25 Index before fees and expenses.
The MVIS US Listed Biotech 25 Index tracks the overall performance of companies involved in the development and production, marketing and sales of drugs based on genetic analysis and diagnostic equipment.
Costs
Cost is an important factor in selecting the right ETF, and cheaper funds can significantly outperform their more expensive counterparts if all other fundamentals are the same.
Annual operating expenses for this ETF are 0.35%, making it one of the least expensive products in the space.
It has a 12-month trailing dividend yield of 0.46%.
Sector Exposure and Top Holdings
Even though ETFs offer diversified exposure that minimizes single stock risk, investors should also look at the actual holdings inside the fund. Luckily, most ETFs are very transparent products that disclose their holdings on a daily basis.
This ETF has heaviest allocation in the Healthcare sector--about 100% of the portfolio.
Looking at individual holdings, Amgen Inc (AMGN - Free Report) accounts for about 12.77% of total assets, followed by Gilead Sciences Inc (GILD - Free Report) and Vertex Pharmaceuticals Inc (VRTX - Free Report) .
The top 10 holdings account for about 63.86% of total assets under management.
Performance and Risk
Year-to-date, the VanEck Biotech ETF has added roughly 1.27% so far, and it's up approximately 0.45% over the last 12 months (as of 08/11/2023). BBH has traded between $136.76 and $170.13 in this past 52-week period.
The ETF has a beta of 0.83 and standard deviation of 24.01% for the trailing three-year period, making it a high risk choice in the space. With about 26 holdings, it has more concentrated exposure than peers.
Alternatives
VanEck Biotech ETF sports a Zacks ETF Rank of 4 (Sell), which is based on expected asset class return, expense ratio, and momentum, among other factors. BBH, then, is not a suitable option for investors seeking exposure to the Health Care ETFs segment of the market. However, there are better ETFs in the space to consider.
SPDR S&P Biotech ETF (XBI - Free Report) tracks S&P Biotechnology Select Industry Index and the iShares Biotechnology ETF (IBB - Free Report) tracks Nasdaq Biotechnology Index. SPDR S&P Biotech ETF has $6.20 billion in assets, iShares Biotechnology ETF has $7.48 billion. XBI has an expense ratio of 0.35% and IBB charges 0.44%.
Bottom Line
To learn more about this product and other ETFs, screen for products that match your investment objectives and read articles on latest developments in the ETF investing universe, please visit Zacks ETF Center.
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Should You Invest in the VanEck Biotech ETF (BBH)?
Looking for broad exposure to the Healthcare - Biotech segment of the equity market? You should consider the VanEck Biotech ETF (BBH - Free Report) , a passively managed exchange traded fund launched on 12/20/2011.
Passively managed ETFs are becoming increasingly popular with institutional as well as retail investors due to their low cost, transparency, flexibility and tax efficiency. They are excellent vehicles for long term investors.
Sector ETFs are also funds of convenience, offering many ways to gain low risk and diversified exposure to a broad group of companies in particular sectors. Healthcare - Biotech is one of the 16 broad Zacks sectors within the Zacks Industry classification. It is currently ranked 8, placing it in top 50%.
Index Details
The fund is sponsored by Van Eck. It has amassed assets over $486.42 million, making it one of the average sized ETFs attempting to match the performance of the Healthcare - Biotech segment of the equity market. BBH seeks to match the performance of the MVIS US Listed Biotech 25 Index before fees and expenses.
The MVIS US Listed Biotech 25 Index tracks the overall performance of companies involved in the development and production, marketing and sales of drugs based on genetic analysis and diagnostic equipment.
Costs
Cost is an important factor in selecting the right ETF, and cheaper funds can significantly outperform their more expensive counterparts if all other fundamentals are the same.
Annual operating expenses for this ETF are 0.35%, making it one of the least expensive products in the space.
It has a 12-month trailing dividend yield of 0.46%.
Sector Exposure and Top Holdings
Even though ETFs offer diversified exposure that minimizes single stock risk, investors should also look at the actual holdings inside the fund. Luckily, most ETFs are very transparent products that disclose their holdings on a daily basis.
This ETF has heaviest allocation in the Healthcare sector--about 100% of the portfolio.
Looking at individual holdings, Amgen Inc (AMGN - Free Report) accounts for about 12.77% of total assets, followed by Gilead Sciences Inc (GILD - Free Report) and Vertex Pharmaceuticals Inc (VRTX - Free Report) .
The top 10 holdings account for about 63.86% of total assets under management.
Performance and Risk
Year-to-date, the VanEck Biotech ETF has added roughly 1.27% so far, and it's up approximately 0.45% over the last 12 months (as of 08/11/2023). BBH has traded between $136.76 and $170.13 in this past 52-week period.
The ETF has a beta of 0.83 and standard deviation of 24.01% for the trailing three-year period, making it a high risk choice in the space. With about 26 holdings, it has more concentrated exposure than peers.
Alternatives
VanEck Biotech ETF sports a Zacks ETF Rank of 4 (Sell), which is based on expected asset class return, expense ratio, and momentum, among other factors. BBH, then, is not a suitable option for investors seeking exposure to the Health Care ETFs segment of the market. However, there are better ETFs in the space to consider.
SPDR S&P Biotech ETF (XBI - Free Report) tracks S&P Biotechnology Select Industry Index and the iShares Biotechnology ETF (IBB - Free Report) tracks Nasdaq Biotechnology Index. SPDR S&P Biotech ETF has $6.20 billion in assets, iShares Biotechnology ETF has $7.48 billion. XBI has an expense ratio of 0.35% and IBB charges 0.44%.
Bottom Line
To learn more about this product and other ETFs, screen for products that match your investment objectives and read articles on latest developments in the ETF investing universe, please visit Zacks ETF Center.