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Should You Invest in the VanEck Biotech ETF (BBH)?
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The VanEck Biotech ETF (BBH - Free Report) was launched on 12/20/2011, and is a passively managed exchange traded fund designed to offer broad exposure to the Healthcare - Biotech segment of the equity market.
An increasingly popular option among retail and institutional investors, passively managed ETFs offer low costs, transparency, flexibility, and tax efficiency; they are also excellent vehicles for long term investors.
Sector ETFs also provide investors access to a broad group of companies in particular sectors that offer low risk and diversified exposure. Healthcare - Biotech is one of the 16 broad Zacks sectors within the Zacks Industry classification. It is currently ranked 5, placing it in top 31%.
Index Details
The fund is sponsored by Van Eck. It has amassed assets over $455.53 million, making it one of the larger 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
Investors should also pay attention to an ETF's expense ratio. Lower cost products will produce better results than those with a higher cost, assuming all other metrics remain 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 0.48%.
Sector Exposure and Top Holdings
It is important to delve into an ETF's holdings before investing despite the many upsides to these kinds of funds like diversified exposure, which minimizes single stock risk. And, 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 lost about -1.75% so far, and it's up approximately 10.55% over the last 12 months (as of 10/11/2023). BBH has traded between $142.49 and $170.13 in this past 52-week period.
The ETF has a beta of 0.82 and standard deviation of 23.49% 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 the best option for investors seeking exposure to the Health Care ETFs segment of the market. Instead, 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 $5.47 billion in assets, iShares Biotechnology ETF has $7.03 billion. XBI has an expense ratio of 0.35% and IBB charges 0.45%.
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)?
The VanEck Biotech ETF (BBH - Free Report) was launched on 12/20/2011, and is a passively managed exchange traded fund designed to offer broad exposure to the Healthcare - Biotech segment of the equity market.
An increasingly popular option among retail and institutional investors, passively managed ETFs offer low costs, transparency, flexibility, and tax efficiency; they are also excellent vehicles for long term investors.
Sector ETFs also provide investors access to a broad group of companies in particular sectors that offer low risk and diversified exposure. Healthcare - Biotech is one of the 16 broad Zacks sectors within the Zacks Industry classification. It is currently ranked 5, placing it in top 31%.
Index Details
The fund is sponsored by Van Eck. It has amassed assets over $455.53 million, making it one of the larger 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
Investors should also pay attention to an ETF's expense ratio. Lower cost products will produce better results than those with a higher cost, assuming all other metrics remain 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 0.48%.
Sector Exposure and Top Holdings
It is important to delve into an ETF's holdings before investing despite the many upsides to these kinds of funds like diversified exposure, which minimizes single stock risk. And, 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 lost about -1.75% so far, and it's up approximately 10.55% over the last 12 months (as of 10/11/2023). BBH has traded between $142.49 and $170.13 in this past 52-week period.
The ETF has a beta of 0.82 and standard deviation of 23.49% 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 the best option for investors seeking exposure to the Health Care ETFs segment of the market. Instead, 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 $5.47 billion in assets, iShares Biotechnology ETF has $7.03 billion. XBI has an expense ratio of 0.35% and IBB charges 0.45%.
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.