In the case of IBB, the ETF is arguably not as volatile as some investors may believe it is. The fund has a beta of just 1.05 against the S&P 500 and a three-year standard deviation of 17.43%, according to iShares data.
EEM’s beta is only modestly higher, but its three-year standard deviation trumps IBB by over 400 basis points. IEV is, not surprisingly, an even more volatile offender with a beta of 1.45 and a three-year standard deviation north of 22%.
iShares Nasdaq Biotechnology Index Fund
ETF Trends editorial team contributed to this article.
Full disclosure: Tom Lydon’s clients own EEM.