ETFs tracking homebuilder and biotech stocks are the top-performing sectors in 2012 as the funds break out to multiyear highs.

The iShares Dow Jones US Home Construction Index Fund (NYSEArca: ITB) is up 42.6% year to date to lead all sector funds. SPDR S&P Homebuilders (NYSEArca: XHB) is another ETF indexed to residential housing stocks. [Homebuilder ETF at Highest Level Since 2008]

Investors in builder ETFs are looking for a bottom in the housing market after the subprime meltdown.

SPDR S&P Biotech (NYSEArca: XBI) and First Trust NYSE Arca Biotech (NYSEArca: FBT) are up 39.6% and 38.5% so far this year, respectively, according to investment researcher Morningstar. [Biotech ETF Breakout]

Biotech ETFs are rising on a bullish outlook for the drug industry and investors positioning for consolidation in the sector. XBI was trading at a fresh lifetime high on Thursday.

Showing Page 1 of 2