Best biotech ETFs to buy in 2023

Biotechnology is an industry of pivotal growth and peaks investor interest. This page provides an overview of the best biotech ETFs this year.
Updated: Oct 11, 2022

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Biotechnology is an important and innovative sector of the market. The potential for growth entices investors because if a biotech company’s plans hit fruition, investors stand to gain record returns. This page offers our experts’ selection of the best biotech ETFs on the market today.

What are the top biotech ETFs to buy?

Our analysts have selected five of the best biotech ETFs for this year as displayed in the table below. Continue scrolling further to learn more about each ETF in turn. 

#ETF symbolETF nameWhere to Trade
1IBBiShares Biotechnology ETF

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77% of retail CFD accounts lose money.

3ARKGARK Genomic Revolution ETF

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4BBHVanEck Biotech ETF

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5PBEInvesco Dynamic Biotechnology & Genome ETF

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List chosen by our team of analysts, 20th July 2022

1. iShares Biotechnology ETF (NASDAQ: IBB)

IBB is a fund that seeks to align with the yield and performance of a modified  market-cap-weighted index that comprises US biotechnology companies listed on US exchanges. The fund currently has 377 holdings in companies that focus on the research and development of therapeutic treatments. 

Despite a downturn in growth of 6% in the previous year of the pandemic, IBB has grown 12% in the last 3 years. This can partially be attributed to investor interest in biotech companies to deliver solutions for the pandemic.

The fund also rates highly for its ESG initiatives. This means that in the event of ESG-related disruptions, IBB’s performance is likely to remain resilient. Investors interested in the fund should do their own due diligence into whether the fund is a good fit for their portfolio to best place their investment.

77% of retail CFD accounts lose money.


XBI corresponds with a biotechnology segment of a US total market composite index.  The fund currently has 159 holdings in American stocks. XBI is a rarity among biotech ETFs as it offers access to a market that is resilient to periods of consolidation: a narrow niche of the healthcare sector.

This narrow focus enables the fund to make big jumps in the event of major drug approvals. However, it also means that the fund is targeted at more active investors with higher risk appetites. Focusing on a narrow niche within healthcare is risky and often too precise for long-term investors seeking a low-risk portfolio.

In the same vein, it must be noted that the fund’s assets are almost evenly distributed across its holdings. This entails that there is low specific-holding risk associated with the ETF. Therefore, XBI is most suited to investors who are bullish on a niche healthcare sector and can afford to be so in the long run.

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3. ARK Genomic Revolution ETF (BATS: ARKG)

ARKG is an actively managed fund that aims for long-term capital growth by investing in US and global securities. It currently has 55 holdings in companies across multiple sectors that relate to the fund’s investment theme of genomics revolutions. These sectors are healthcare, energy, information technology, consumer discretionary, and materials. 

Its niche theme is based on the hope that the companies it holds shall substantially grow from their technological and scientific developments in genomics. This poses substantial niche risk for investors and you must be bullish on ARKG’s theme to invest for the long run. Furthermore, with only 55 holdings, investors must also consider specific-holding risk when investing in ARKG.

However, with greater risk there is greater reward. If its niche holdings perform well, you are in with a chance to gain significant profit through your investment in ARKG. The fund operates on a 0.75% management fee structure, which is affordable and relatively standard for biotech ETFs.

77% of retail CFD accounts lose money.

4. VanEck Biotech ETF (NASDAQGM: BBH)

BBH seeks to replicate the MVIS US Listed Biotech 25 Index. The index tracks the performance of companies involved in the development and production, marketing and sales of drugs related to genetic analysis and diagnostic equipment.

The fund has 25 holdings, as per the Index. It focuses on the largest and most liquid companies in the biotech industry (i.e. Moderna is its second largest holding allocated at 10% of the fund’s assets). Furthermore, holding the biggest US and global names means that BBH allows for enhanced industry representation.

This makes the fund a solid bet for investors looking to invest for the long run. Established names in the biotech industry can often carry the industry, and if you are interested in biotech then BBH may prove a value-add for your portfolio.

77% of retail CFD accounts lose money.

5. Invesco Dynamic Biotechnology & Genome ETF (NYSEARCA: PBE) 

PBE is a fund that is based on the Dynamic Biotech & Genome Intellidex Index. It currently has 30 holdings in US biotechnology and genome companies. These companies are focused on the research, development, production, and sales of products, services, and processes that focus on advances in biotech research and genetic engineering.

The fund has grown 10% since it started out in 2005. PBE benefits from even asset allocation across its holdings which allows for hedging against specific-holding risk despite the small number of holdings. This is beneficial to investors opting for a passive style of long term investment.

Due to the lack of diversity in its thematic holdings, the fund is still prone to the niche industry risk of biotech research and genetic engineering. This is an upcoming and innovative sector and carries its own risks. Therefore, it is best to do your own due diligence and stay on top of news to best place your investment in PBE.

77% of retail CFD accounts lose money.

Where to buy the best biotech ETFs

Choosing an online ETF platform is the first step to buy any of the above exchange-traded funds for the biotech industry. ETFs are like individual stocks, you can buy or sell them as is convenient. The table below features our preference of the best brokers that offer biotech ETFs.

Min. Deposit
$ 10
Best offer
User Score
Up to $240 bonus!
Deposit with ACA, Wire, Pay with my bank
Invest for dividends and get payout on stocks on Ex-Dividend day
Start Trading
Payment Methods:
Bank Transfer, Credit Card, Debit Card, PayPal, Wire Transfer
Full Regulations:

77% of retail CFD accounts lose money.

Min. Deposit
$ 0
Best offer
User Score
Get insights from millions of investors, creators, and analysts
Build your portfolio of stocks, ETFs, and crypto–all in one place
No minimum deposit
Start Trading
Payment Methods:
Bank Wire, Check, Debit Card, Wire Transfer
Full Regulations:
Cryptocurrency execution and custody services are provided by Apex Crypto LLC (NMLS ID 1828849) through a software licensing agreement between Apex Crypto LLC and Public Crypto LLC. Crypto trading on Public platforms is served by Public Crypto LLC and offered through APEX Crypto. Please ensure that you fully understand the risks involved before trading.
Min. Deposit
$ 100
Best offer
User Score
Trade out-of-hours on over 70+ US stocks
Get exposure to a wide range of popular UK, US and international stocks
Enjoy flexible access to more than 17,000 global markets, with reliable execution
Start Trading
Payment Methods:
Bank Transfer, Credit Card, Debit Card, PayPal
Full Regulations:
ASIC, FCA, FINMA, is a licensed bank (IG Bank in Switzerland)
Spread bets and CFDs are complex instruments and come with a high risk of losing money rapidly due to leverage. 75% of retail investor accounts lose money when trading spread bets and CFDs with this provider. You should consider whether you understand how spread bets and CFDs work, and whether you can afford to take the high risk of losing your money.

What is a biotech ETF?

It’s an exchange traded fund that holds shares in companies that operate in the biotech industry. Companies in this sector focus on the development of novelty drugs and advancements in clinical research to treat medical conditions and diseases.

Biotechnology is an innovative and disruptive sector due to the speculative growth nature of the products and services on offer. As a result, biotech ETFs are often risky investments and intended for more active investors.  

Are biotech ETFs a good investment?

With high risk comes high rewards. Biotech companies are disruptive, innovative, and have untapped potential for growth. This means that ETFs holding these company stocks carry more risk than ETFs focused on other relatively stable industries.

Biotech ETFs are intended for more active investors with higher risk appetites. You must be able to cope with risk in the long term and not expect instant returns on your investment if you want to invest in biotech ETFs.

With the ongoing pandemic, the biotech industry is more prevalent than ever before. Unlike other industries, biotech is able to carry the pandemic in its stride (for example, through companies that focus on new drug development). Tech ETFs may be another area of interest for investors with lower risk aversion who want to enter the biotech sector.

You should best place your investment by doing your own due diligence and staying on top of the news using the links below.

Latest biotech ETF news

Shares of Five Below Inc (NASDAQ: FIVE) ended nearly 10% up on Friday even though the discount retailer said its sales came in slightly below expectations in the first quarter. Five Below stock up on strong guidance The retail stock was rewarded primarily because the management raised its…
Nio ( NYSE: NIO) stock price has been in a freefall and the situation could get worse in the coming week when the company publishes its financial results. The stock plunged to $7.75 on Friday and is hovering near its lowest level in 2020. It has dropped by over…
Trade Desk Inc (NASDAQ: TTD) is in the green on Friday after a Morgan Stanley analyst named it a top pick in ad stocks. Trade Desk stock has 20% upside from here Matthew Cost upgraded the California-based company this morning on “overweight” and raised his price objective to $90…
International Consolidated Airlines Group S.A. (LON: IAG) is in focus today after the U.S. government inflicted a $1.1 million fine on British Airways. DOT received over 1,200 complaints against BA On Friday, the U.S. Transportation Department said the air carrier did not refund its passengers…
SentinelOne Inc (NYSE: S) opened more than 35% down today after reporting disappointing results for its first financial quarter. SentinelOne stock down on weak outlook The cybersecurity stock is being punished also because the management cited a slowdown in business spending and slashed their guidance for the full…
American stocks are doing great as one of the biggest risks in the economy has dissipated. The closely-watched tech-heavy Invesco QQQ ETF has jumped by 32% this year while the iShares Core S&P 500 (IVV) has jumped by 11.12% this year. Return of the raging bull The QQQ and IVV…

Sources & references
Risk disclaimer
Srijani Chatterjee
Financial Writer
Srijani is the quintessential Third Culture Kid having grown up in India, Singapore, Malaysia, The Netherlands, Scotland, and England. She still loves to travel and speaks… read more.