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Is First Trust NASDAQ Pharmaceuticals ETF (FTXH) a Strong ETF Right Now?
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The First Trust NASDAQ Pharmaceuticals ETF (FTXH - Free Report) was launched on 09/20/2016, and is a smart beta exchange traded fund designed to offer broad exposure to the Health Care ETFs category of the market.
What Are Smart Beta ETFs?
For a long time now, the ETF industry has been flooded with products based on market capitalization weighted indexes, which are designed to represent the broader market or a particular market segment.
Market cap weighted indexes work great for investors who believe in market efficiency. They provide a low-cost, convenient and transparent way of replicating market returns.
However, some investors believe in the possibility of beating the market through exceptional stock selection, and choose a different type of fund that tracks non-cap weighted strategies: smart beta.
Non-cap weighted indexes try to choose stocks that have a better chance of risk-return performance, which is based on specific fundamental characteristics, or a mix of other such characteristics.
This area offers many different investment choices, such as simplest equal-weighting, fundamental weighting and volatility/momentum based weighting methodologies; however, not all of these strategies can deliver superior results.
Fund Sponsor & Index
Because the fund has amassed over $1.07 billion, this makes it one of the larger ETFs in the Health Care ETFs. FTXH is managed by First Trust Advisors. Before fees and expenses, FTXH seeks to match the performance of the Nasdaq US Smart Pharmaceuticals Index.
The Nasdaq US Smart Pharmaceuticals Index is a modified factor weighted index, designed to provide exposure to US companies within the pharmaceuticals industry.
Cost & Other Expenses
When considering an ETF's total return, expense ratios are an important factor. And, cheaper funds can significantly outperform their more expensive cousins in the long term if all other factors remain equal.
With on par with most peer products in the space, this ETF has annual operating expenses of 0.60%.
The fund has a 12-month trailing dividend yield of 0.70%.
Sector Exposure and Top Holdings
Even though ETFs offer diversified exposure which minimizes single stock risk, it is still important to look into a fund's holdings before investing. 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.
When you look at individual holdings, Abbvie Inc. (ABBV) accounts for about 7.46% of the fund's total assets, followed by Eli Lilly And Company (LLY) and Merck & Co., Inc. (MRK).
Its top 10 holdings account for approximately 53.89% of FTXH's total assets under management.
Performance and Risk
The ETF has added about 25.84% and it's up approximately 43.75% so far this year and in the past one year (as of 10/15/2026), respectively. FTXH has traded between $28.93 and $42.76 during this last 52-week period.
The ETF has a beta of 0.45 and standard deviation of 16.99% for the trailing three-year period. With about 51 holdings, it effectively diversifies company-specific risk .
Alternatives
First Trust NASDAQ Pharmaceuticals ETF is a reasonable option for investors seeking to outperform the Health Care ETFs segment of the market. However, there are other ETFs in the space which investors could consider.
VanEck Pharmaceutical ETF (PPH) tracks MVIS US Listed Pharmaceutical 25 Index and the iShares U.S. Pharmaceuticals ETF (IHE) tracks Dow Jones U.S. Select Pharmaceuticals Index. VanEck Pharmaceutical ETF has $1.06 billion in assets, iShares U.S. Pharmaceuticals ETF has $1.54 billion. PPH has an expense ratio of 0.36% and IHE changes 0.37%.
Investors looking for cheaper and lower-risk options should consider traditional market cap weighted ETFs that aim to match the returns of the Health Care ETFs
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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Is First Trust NASDAQ Pharmaceuticals ETF (FTXH) a Strong ETF Right Now?
The First Trust NASDAQ Pharmaceuticals ETF (FTXH - Free Report) was launched on 09/20/2016, and is a smart beta exchange traded fund designed to offer broad exposure to the Health Care ETFs category of the market.
What Are Smart Beta ETFs?
For a long time now, the ETF industry has been flooded with products based on market capitalization weighted indexes, which are designed to represent the broader market or a particular market segment.
Market cap weighted indexes work great for investors who believe in market efficiency. They provide a low-cost, convenient and transparent way of replicating market returns.
However, some investors believe in the possibility of beating the market through exceptional stock selection, and choose a different type of fund that tracks non-cap weighted strategies: smart beta.
Non-cap weighted indexes try to choose stocks that have a better chance of risk-return performance, which is based on specific fundamental characteristics, or a mix of other such characteristics.
This area offers many different investment choices, such as simplest equal-weighting, fundamental weighting and volatility/momentum based weighting methodologies; however, not all of these strategies can deliver superior results.
Fund Sponsor & Index
Because the fund has amassed over $1.07 billion, this makes it one of the larger ETFs in the Health Care ETFs. FTXH is managed by First Trust Advisors. Before fees and expenses, FTXH seeks to match the performance of the Nasdaq US Smart Pharmaceuticals Index.
The Nasdaq US Smart Pharmaceuticals Index is a modified factor weighted index, designed to provide exposure to US companies within the pharmaceuticals industry.
Cost & Other Expenses
When considering an ETF's total return, expense ratios are an important factor. And, cheaper funds can significantly outperform their more expensive cousins in the long term if all other factors remain equal.
With on par with most peer products in the space, this ETF has annual operating expenses of 0.60%.
The fund has a 12-month trailing dividend yield of 0.70%.
Sector Exposure and Top Holdings
Even though ETFs offer diversified exposure which minimizes single stock risk, it is still important to look into a fund's holdings before investing. 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.
When you look at individual holdings, Abbvie Inc. (ABBV) accounts for about 7.46% of the fund's total assets, followed by Eli Lilly And Company (LLY) and Merck & Co., Inc. (MRK).
Its top 10 holdings account for approximately 53.89% of FTXH's total assets under management.
Performance and Risk
The ETF has added about 25.84% and it's up approximately 43.75% so far this year and in the past one year (as of 10/15/2026), respectively. FTXH has traded between $28.93 and $42.76 during this last 52-week period.
The ETF has a beta of 0.45 and standard deviation of 16.99% for the trailing three-year period. With about 51 holdings, it effectively diversifies company-specific risk .
Alternatives
First Trust NASDAQ Pharmaceuticals ETF is a reasonable option for investors seeking to outperform the Health Care ETFs segment of the market. However, there are other ETFs in the space which investors could consider.
VanEck Pharmaceutical ETF (PPH) tracks MVIS US Listed Pharmaceutical 25 Index and the iShares U.S. Pharmaceuticals ETF (IHE) tracks Dow Jones U.S. Select Pharmaceuticals Index. VanEck Pharmaceutical ETF has $1.06 billion in assets, iShares U.S. Pharmaceuticals ETF has $1.54 billion. PPH has an expense ratio of 0.36% and IHE changes 0.37%.
Investors looking for cheaper and lower-risk options should consider traditional market cap weighted ETFs that aim to match the returns of the Health Care ETFs
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.