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Is First Trust NYSE Arca Biotechnology ETF (FBT) a Strong ETF Right Now?
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Making its debut on 06/19/2006, smart beta exchange traded fund First Trust NYSE Arca Biotechnology ETF (FBT - Free Report) provides investors broad exposure to the Health Care ETFs category of the market.
What Are Smart Beta ETFs?
The ETF industry has long been dominated by products based on market cap weighted indexes, a strategy created to reflect the market or a particular market segment.
Market cap weighted indexes offer a low-cost, convenient, and transparent way of replicating market returns, and are a good option for investors who believe in market efficiency.
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.
These indexes attempt to select stocks that have better chances of risk-return performance, based on certain fundamental characteristics or a combination of such characteristics.
The smart beta space gives investors many different choices, from equal-weighting, one of the simplest strategies, to more complicated ones like fundamental and volatility/momentum based weighting. However, not all of these methodologies have been able to deliver remarkable returns.
Fund Sponsor & Index
The fund is managed by First Trust Advisors, and has been able to amass over $3.03 billion, which makes it one of the larger ETFs in the Health Care ETFs. This particular fund seeks to match the performance of the NYSE Arca Biotechnology Index before fees and expenses.
The NYSE Arca Biotechnology Index is an equal dollar weighted index designed to measure the performance of a cross section of companies in the biotechnology industry that are primarily involved in the use of biological processes to develop products or provide services.
Cost & Other Expenses
Cost is an important factor in selecting the right ETF, and cheaper funds can significantly outperform their more expensive cousins if all other fundamentals are the same.
Annual operating expenses for this ETF are 0.55%, making it on par with most peer products in the space.
It has a 12-month trailing dividend yield of 0.00%.
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.
For FBT, it has heaviest allocation in the Healthcare sector --about 100% of the portfolio.
Looking at individual holdings, Natera, Inc. (NTRA) accounts for about 4.74% of total assets, followed by Halozyme Therapeutics, Inc. (HALO) and Illumina, Inc. (ILMN).
FBT's top 10 holdings account for about 40.05% of its total assets under management.
Performance and Risk
The ETF has added about 31.51% so far this year and is up roughly 38.22% in the last one year (as of 11/11/2026). In the past 52-week period, it has traded between $190.23 and $280.30
The ETF has a beta of 0.68 and standard deviation of 20.96% for the trailing three-year period, making it a high risk choice in the space. With about 31 holdings, it has more concentrated exposure than peers .
Alternatives
First Trust NYSE Arca Biotechnology ETF is an excellent option for investors seeking to outperform the Health Care ETFs segment of the market. There are other ETFs in the space which investors could consider as well.
State Street SPDR S&P Biotech ETF (XBI) tracks S&P Biotechnology Select Industry Index and the iShares Biotechnology ETF (IBB) tracks Nasdaq Biotechnology Index. State Street SPDR S&P Biotech ETF has $10.5 billion in assets, iShares Biotechnology ETF has $11.24 billion. XBI has an expense ratio of 0.35% and IBB changes 0.44%.
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 NYSE Arca Biotechnology ETF (FBT) a Strong ETF Right Now?
Making its debut on 06/19/2006, smart beta exchange traded fund First Trust NYSE Arca Biotechnology ETF (FBT - Free Report) provides investors broad exposure to the Health Care ETFs category of the market.
What Are Smart Beta ETFs?
The ETF industry has long been dominated by products based on market cap weighted indexes, a strategy created to reflect the market or a particular market segment.
Market cap weighted indexes offer a low-cost, convenient, and transparent way of replicating market returns, and are a good option for investors who believe in market efficiency.
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.
These indexes attempt to select stocks that have better chances of risk-return performance, based on certain fundamental characteristics or a combination of such characteristics.
The smart beta space gives investors many different choices, from equal-weighting, one of the simplest strategies, to more complicated ones like fundamental and volatility/momentum based weighting. However, not all of these methodologies have been able to deliver remarkable returns.
Fund Sponsor & Index
The fund is managed by First Trust Advisors, and has been able to amass over $3.03 billion, which makes it one of the larger ETFs in the Health Care ETFs. This particular fund seeks to match the performance of the NYSE Arca Biotechnology Index before fees and expenses.
The NYSE Arca Biotechnology Index is an equal dollar weighted index designed to measure the performance of a cross section of companies in the biotechnology industry that are primarily involved in the use of biological processes to develop products or provide services.
Cost & Other Expenses
Cost is an important factor in selecting the right ETF, and cheaper funds can significantly outperform their more expensive cousins if all other fundamentals are the same.
Annual operating expenses for this ETF are 0.55%, making it on par with most peer products in the space.
It has a 12-month trailing dividend yield of 0.00%.
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.
For FBT, it has heaviest allocation in the Healthcare sector --about 100% of the portfolio.
Looking at individual holdings, Natera, Inc. (NTRA) accounts for about 4.74% of total assets, followed by Halozyme Therapeutics, Inc. (HALO) and Illumina, Inc. (ILMN).
FBT's top 10 holdings account for about 40.05% of its total assets under management.
Performance and Risk
The ETF has added about 31.51% so far this year and is up roughly 38.22% in the last one year (as of 11/11/2026). In the past 52-week period, it has traded between $190.23 and $280.30
The ETF has a beta of 0.68 and standard deviation of 20.96% for the trailing three-year period, making it a high risk choice in the space. With about 31 holdings, it has more concentrated exposure than peers .
Alternatives
First Trust NYSE Arca Biotechnology ETF is an excellent option for investors seeking to outperform the Health Care ETFs segment of the market. There are other ETFs in the space which investors could consider as well.
State Street SPDR S&P Biotech ETF (XBI) tracks S&P Biotechnology Select Industry Index and the iShares Biotechnology ETF (IBB) tracks Nasdaq Biotechnology Index. State Street SPDR S&P Biotech ETF has $10.5 billion in assets, iShares Biotechnology ETF has $11.24 billion. XBI has an expense ratio of 0.35% and IBB changes 0.44%.
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.