The First Trust NYSE Arca Biotechnology ETF (FBT) was launched on June 19, 2006, and is a passively managed exchange traded fund designed to offer broad exposure to the Healthcare - Biotech segment of the equity market.
While an excellent vehicle for long term investors, passively managed ETFs are a popular choice among institutional and retail investors due to their low costs, transparency, flexibility, and tax efficiency.
Investor-friendly, sector ETFs provide many options 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 4, placing it in top 25%.
Index Details
The fund is sponsored by First Trust Advisors. It has amassed assets over $1.39 billion, making it one of the larger ETFs attempting to match the performance of the Healthcare - Biotech segment of the equity market. FBT 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.
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 0.54%, making it on par with most peer products in the space.
Sector Exposure and Top Holdings
While ETFs offer diversified exposure, which minimizes single stock risk, a deep look into a fund's holdings is a valuable exercise. 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, Exact Sciences Corporation (EXAS) accounts for about 4.95% of total assets, followed by Natera, Inc. (NTRA) and Illumina, Inc. (ILMN).
The top 10 holdings account for about 38.84% of total assets under management.
Performance and Risk
Year-to-date, the First Trust NYSE Arca Biotechnology ETF has added about 29.4% so far, and is up roughly 28.61% over the last 12 months (as of 12/25/2025). FBT has traded between $145.666 and $215.09 in this past 52-week period.
The ETF has a beta of 0.66 and standard deviation of 19.35% 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 carries a Zacks ETF Rank of 3 (Hold), which is based on expected asset class return, expense ratio, and momentum, among other factors. Thus, FBT is a good option for those seeking exposure to the Health Care ETFs area of the market. Investors might also want to consider some other ETF options in the space.
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 $8.36 billion in assets, iShares Biotechnology ETF has $8.43 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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First Trust NYSE Arca Biotechnology ETF (FBT): ETF Research ReportsThis article originally published on Zacks Investment Research (zacks.com).
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