Investing in an ETF comes with a cost beyond just the transaction charge that a brokerage might require. The funds charge fees to cover their operating costs. The is calculated by dividing the fund's operating expenses by its average assets.Biotech ETFs have all the characteristics of ETFs in general. The key difference is that these ETFs hold only the stocks of companies that focus on biotechnology.Best biotech ETFsBest biotech ETFs in 2025The best biotech ETFs tend to be the biggest ones. They have large amounts of and relatively low expense ratios. Here are five of the best biotech ETFs.1 - 21. iShares Biotechnology ETFTotal assets: $7.1 billionExpense ratio: 0.45%Dividend yield: 0.17%The iShares Biotechnology ETF ( -0.43%) attempts to track the results of an index that includes all U.S.-listed stocks in the biotechnology sector. The ETF currently owns around 214 biotech stocks.Among the iShares Biotechnology ETF's top holdings are some of the biggest biotech stocks based on rank. They include Gilead Sciences ( 2.83%), Vertex Pharmaceuticals ( -0.49%), Amgen ( -0.69%), Regeneron Pharmaceuticals ( 0.0%), and IQVIA Holdings ( -0.35%).Since its inception in 2001, the ETF has delivered an average annualized total return of 6.6%. Over the past five years, it has generated an annualized total return of about 8.2%.2. SPDR S&P Biotech ETFTotal assets: $7 billionExpense ratio: 0.35%Dividend yield: 0.15%The SPDR S&P Biotech ETF ( -0.84%) seeks to track the S&P Biotechnology Select Industry Index. The index uses a modified equal weighting, which means the percentage of total assets for each stock owned is roughly the same. It gives investors exposure to , , and biotech stocks. The ETF currently owns around 140 stocks. Its top holdings include Alnylam Pharmaceuticals ( 1.43%), Viking Therapeutics ( -5.79%), Gilead Sciences, Exact Sciences ( 3.57%), and Sarepta Therapeutics ( -0.75%). However, because of its modified equal weighting, none of the largest positions in the ETF make up a significantly greater percentage of assets than other stocks. The SPDR S&P Biotech ETF has delivered a total annualized return of about 10.4% since its inception in 2006. Over the past five years, however, the ETF generated an average annual return of 5.4%., 7 Best Biotech ETFs to Buy Now The biotech industry can be quite boom-or-bust, so the diversification offered by an ETF can be highly valuable., Biotech ETFs can help investors diversify their portfolios and expose them to new technologies at a lower cost and lower risk than the sometimes volatile biotech sector..