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The Motley Fool

12 Jul 2026, 19:30 UTC · 1h ago

Biotech ETFs: How Do FBT and IBB Match Up on Cost, Structure, and Performance?

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What the story claims

4 claims · each scored for market impact

What matters in this story

1
The First Trust Biotechnology Fund (FBT) utilizes a highly concentrated portfolio of only 30 stocks, increasing its idiosyncratic risk compared to broader benchmarks. — Higher concentration in a volatile sector like biotech increases the risk of significant price swings based on a few individual company failures.
-0.30
2
The iShares Biotechnology ETF (IBB) provides broad diversification with 248 holdings and is heavily influenced by large-cap established players like Vertex, Amgen, and Gilead. — Market-cap weighting in established firms generally reduces volatility and provides more stability than concentrated small-cap bets.
+0.20
3
The iShares fund (IBB) has a lower expense ratio of 0.44% compared to 0.55% for the First Trust fund (FBT). — Lower fees marginally improve long-term net returns for investors, though the difference is relatively small.
+0.10
4