The exchange-traded funds that invest in the stocks of biotechnology companies are known as biotech ETFs. Biotech companies are mainly involved in revolutionary processes in the healthcare industry, including genetic engineering, molecular biology, and recombinant DNA technology.
They are exciting avenues of investment as they combine both biology and technology and follow the advancements in the field of genetics, pharmaceuticals, environment, agriculture, and medicine.
Biotech ETFs are impacted by all the major news, developments, and changes in the healthcare and biotech space. Thus, the performance of biotech ETFs follows a high-risk high-reward profile.
|IBB||iShares Nasdaq Biotechnology ETF||$159.49||20.50%|
|XBI||SPDR S&P Biotech ETF||$124.84||9.32%|
|FBT||First Trust Amex Biotechnology Index||$164.85||7.10%|
|LABU||Direxion Daily S&P Biotech Bull 3x Shares||$53.55||-4.07%|
|ARKG||ARK Genomic Revolution Multi-Sector ETF||$76.00||11.19%|
|BBH||VanEck Vectors Biotech ETF||$198.71||28.46%|
|PBE||Invesco Dynamic Biotechnology & Genome ETF||$75.52||30.23%|
|BIB||ProShares Ultra Nasdaq Biotechnology||$90.52||36.10%|
|SBIO||ALPS Medical Breakthroughs ETF||$45.39||3.42%|
|LABD||Direxion Daily S&P Biotech Bear 3x Shares||$21.29||-59.38%|
|BTEC||Principal Healthcare Innovators Index ETF||$53.50||8.61%|
|CNCR||Loncar Cancer Immunotherapy ETF||$28.60||7.20%|
|BBP||Virtus LifeSci Biotech Products ETF||$50.71||4.13%|
|BBC||Virtus LifeSci Biotech Clinical Trials ETF||$43.69||10.47%|
|IDNA||iShares Genomics Immunology and Healthcare ETF||$49.65||27.93%|
|BIS||ProShares UltraShort Nasdaq Biotechnology||$18.86||-40.75%|
|GNOM||Global X Genomics & Biotechnology ETF||$21.64||16.78%|
|CHNA||Loncar China BioPharma ETF||$33.50||12.30%|
|HTEC||ROBO Global Healthcare Technology and Innovation ETF||$46.15||29.42%|
|PSCH||Invesco S&P SmallCap Health Care ETF||$181.22||35.44%|
Factors to Consider Before Investing in Biotech ETFs
The most significant factor to consider before investing in biotech ETFs is the risk factor associated with them. All the biotechnology companies do not end up achieving what they had set out to.
There is a very high probability that a biotech company that has invested millions of dollars in research and development ends up failing at clinical trials and shutters down. Thus, before investing in biotech ETFs, investors must understand the fundamentals of the companies, their product, science behind the products, and the ability of the management team to make them succeed.
Therefore, biotech ETFs are volatile and risky investments, yet they hold strong potential for massive returns if everything goes in favor.
Which Biotech ETFs Should I Buy?
Amidst a large number of biotech ETFs trading on the stock exchanges, we have narrowed down to the best biotech ETFs for you to select from.
Biotech ETFs offer attractive opportunities for investors to gain exposure to the biotechnology sectors without taking too much risk. However, they still hold high-risk potential.
Therefore, investors should use biotech ETFs as a means to diversify their portfolio and consider the assets under management, returns, and expense ratio before investing in biotech ETFs.