State Street SPDR S&P Pharmaceuticals vs First Trust NYSE Arca Biotech: Which Is the Better ETF For Your Portfolio?
Key takeaways
- Investors seeking healthcare exposure often choose between mature pharmaceutical giants and high-growth biotechnology firms.
- Beta measures price volatility relative to the S&P 500; beta is calculated from five-year monthly returns.
- The State Street fund is significantly more affordable, carrying a 0.35% expense ratio compared to the 0.55% charged by the First Trust fund.
Investors seeking healthcare exposure often choose between mature pharmaceutical giants and high-growth biotechnology firms. This comparison examines how these two funds approach their respective sub-sectors, balancing the established cash flows of pharmaceuticals with the research-driven potential and the higher concentration of biotech innovators that populate the healthcare landscape.
Beta measures price volatility relative to the S&P 500; beta is calculated from five-year monthly returns. The 1-yr return represents total return over the trailing 12 months. Dividend yield is the trailing-12-month distribution yield.
The State Street fund is significantly more affordable, carrying a 0.35% expense ratio compared to the 0.55% charged by the First Trust fund. This cost difference can impact long-term compounding for investors who prioritize cost efficiency over a 12-month period.