Skip to navigationSkip to main contentSkip to right columnADVERTISEMENTSara Appino, The Motley FoolThu, July 23, 2026 at 2:35 PM GMT+2 4 min readThe First Trust NYSE Arca Biotechnology Index Fund (NYSEMKT:FBT) provides concentrated, high-conviction exposure to biotechnology firms, while the Vanguard Health Care ETF (NYSEMKT:VHT) offers a cheaper, diversified basket across the entire healthcare sector.Both funds target the healthcare space, but their scopes and strategies differ wildly. Investors choosing between them must decide if they want a specialized bet on biotechnology or a broader investment that includes pharmaceuticals and medical equipment. This analysis breaks down the cost, risk, and portfolio differences between the two products.Snapshot (cost & size)MetricFBTVHTIssuerFirst TrustVanguardShare price$245.30 (as of 2026-07-20)$299.49 (as of 2026-07-20)Expense ratio0.55%0.09%1-yr return (as of 2026-07-20)51.60%25.20%Dividend yieldn/a1.60%Beta0.660.60AUM$3.2 billion$20.4 billionBeta measures price volatility relative to the S&P 500; beta is calculated from monthly returns over the available fund history (up to five years). The 1-yr return represents total return over the trailing 12 months. Dividend yield is the trailing-12-month distribution yield.Cost is a primary differentiator for long-term holders. The Vanguard fund carries a low expense ratio of 0.09%, making it significantly more affordable than the First Trust fund, which charges 0.55% for its specialized index-tracking strategy.Performance & risk comparisonMetricFBTVHTMax drawdown (5 yr)(29.90%)(17.70%)Growth of $1,000 over 5 years (total return)$1,471.00$1,281.00What's insideThe Vanguard Health Care ETF (NYSEMKT:VHT) manages $20.4 billion in assets under management (AUM) and maintains a portfolio of 411 holdings. It provides comprehensive exposure to the sector, with 100.00% of its assets concentrated in healthcare industries. Its largest positions include Eli Lilly (NYSE:LLY) at 14.19%, Johnson & Johnson (NYSE:JNJ) at 8.89%, and AbbVie (NYSE:ABBV) at 6.56%. The fund was launched in 2004.The First Trust NYSE Arca Biotechnology Index Fund (NYSEMKT:FBT) manages $3.2 billion in AUM and takes a narrower approach by holding only 30 securities. It focuses entirely on the biotechnology segment of the healthcare sector. Its top holdings include BeOne Medicines (NASDAQ:ONC) at 3.49%, Veracyte (NASDAQ:VCYT) at 3.47%, and NeoGenomics (NASDAQ:NEO) at 3.46%. The fund was launched in 2006.For more guidance on ETF investing, check out the full guide at this link.What this means for investorsThe healthcare sector is generating more investment headlines than it has in years. Biopharma deal activity surpassed $65 billion in the first quarter of 2026 alone, as pharmaceutical giants raced to acquire the next generation of treatments in oncology, obesity, and immunology. That wave of acquisition activity has been particularly kind to smaller biotechnology companies, exactly the kind that populate FBT's equal-weighted roster of 30 biotech names.Terms and Privacy PolicyEU DSA contactPrivacy & Cookie SettingsMore Info