FTXO ETF Boosts 20% Year‑Over‑Year as IYF Remains Top Choice for Broader Financial Exposure
Key Points
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iShares U.S. Financials ETF is significantly larger and more diversified with 141 holdings compared to the bank‑concentrated First Trust Nasdaq Bank ETF.
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First Trust Nasdaq Bank ETF has delivered a stronger 1‑year total return but carries a considerably deeper 5‑year maximum drawdown.
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iShares U.S. Financials ETF offers a lower expense ratio of 0.37 %, whereas First Trust Nasdaq Bank ETF charges 0.6 %.
The First Trust Nasdaq Bank ETF (NASDAQ:FTXO) targets the banking industry specifically, while the iShares U.S. Financials ETF (NYSEMKT:IYF) delivers broader exposure across the whole financial sector at a lower cost.
Snapshot (cost & size)
Metric|FTXO|IYFE|Issuer|First Trust|iShares|Share price (as of 9/10/26)|$42.04|$134.91|Expense ratio|0.6%|0.37%|1-yr return (as of 9/10/26)|20.2%|9.8%|Dividend yield|1.7%|1.4%|Beta|1.03|0.78|AUM|$299 million|$4.3 billion
Beta 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.
The iShares U.S. Financials ETF is the more affordable option with a 0.37 % expense ratio compared with First Trust Nasdaq Bank ETF’s 0.6 %. However, the First Trust fund provides a marginally higher dividend yield at 1.7 % versus the 1.4 % offered by the iShares fund.
Performance & risk comparison
The iShares U.S. Financials ETF supplies wide‑based coverage of the domestic financial sector—its weights are predominantly financial services with a modest slice of real estate—and holds 141 securities, led by positions such as Berkshire Hathaway (11.6 %), JPMorgan Chase & Co. (11.3 %) and Bank of America (4.24 %). Launched in 2000, the ETF has returned $1.90 per share over the past year, yielding roughly 1.4 % on the current ~$134.9 share price.
Conversely, the First Trust Nasdaq Banking ETF is far more concentrated in banks, comprising 49 holdings with a basket dominated by Citigroup (8.8 %), Bank of America (8.5 %) and JPMorgan Chase (8.35 %). Launched in 2016, it delivered $0.70 per share over the trailing 12‑month period, equating to a 1.7 % dividend yield based on its ~$42.0 price point.
For further guidance on ETF strategy, consult the linked resource.
What’s inside
The iShares U.S. Financials ETF provides broad coverage of the domestic financial sector, with 99 % of its weight allocated to financial services and a slight tilt toward real estate. Holding 141 positions, its biggest constituents include Berkshire Hathaway at 11.6 %, JPMorgan Chase & Co. at 11.3 % and Bank of America at 4.24 %; the fund was launched in 2000 and has historically produced $1.90 per share over the trailing 12‑month horizon, translating to a 1.4 % yield.
In contrast, the First Trust Nasdaq Banking ETF is highly focused on the banking segment, containing 49 positions and led by Citigroup Inc. (8.8 %), Bank of America Corporation (8.5 %) and JPMorgan Chase & Co. (8.35 %). Launched in 2016, this fund posted $0.70 per share over the past year, yielding 1.7 % on its current ~$42.0 price.
For additional context, the full breakdown of holdings and performance metrics follows.
Which looks like the better buy
Banking plays a vital role in the economy, offering stability, reliable income streams and inflation protection through rising rate environments. Choosing between FTXO and IYF rests on the level of breadth versus depth preferred. IYF is a large fund with over 140 positions and $4.3 billion in assets under management, targeting a broad spectrum of financial companies, including banks, mortgage lenders, insurers and more.
FTXO serves as a bank‑specific vehicle—an attractive option for investors drawn to narrow thesis investing. Like IYF, it captures the banking theme with a concentrated stance, however the FTXO fund has displayed heightened volatility over the past five years and carries a smaller asset base (~$300 million) and a slightly higher expense ratio (0.60 %). On the positive note, its banking concentration supports a marginally higher dividend yield (~1.7 % versus IYF’s ~1.4 %).
Beyond these flagship choices, vigilance regarding regulatory change, macroeconomic cycles and credit exposure is essential. For most investors seeking upside in the financial sector, IYF typically offers the more balanced, lower‑volatility path.
Should you buy stock in iShares Trust – iShares U.S. Financials ETF right now?
When evaluating iShares U.S. Financials ETF as a holding, several critical factors warrant careful review before inclusion in a portfolio.
Some outlets frequently spotlight marquee individual securities—such as the Motley Fool’s highlighted stock lists—so readers should treat such prominence as analytical commentary rather than a substitute for primary research. Moreover, the ETF’s performance characteristics differ markedly between the two benchmarks described above.
Investment considerations
• Cost efficiency: IYF’s 0.37 % expense ratio undercuts FTXO’s 0.60 %, resulting in greater net returns when held long term.
• Risk profile: IYF’s broad diversification tempers volatility compared with FTXO’s concentrated banking bias.
• Dividend outlook: FTXO offers a marginally stronger yield (≈1.7 % vs. IYF’s ≈1.4 %).
• Asset magnitude: With nearly half a billion dollars in assets, IYF enjoys stronger average trader participation and tighter bid‑ask spreads.
Conclusion
Both FTXO and IYF serve distinct strategic purposes. The choice hinges on whether an investor prioritizes pure banking exposure (FTXO) or a comprehensive financial sector allocation with superior entry costs and diversification (IYF). A disciplined analysis weighing expense, volatility, yield and portfolio fit will guide the optimal selection.
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Bank of America is an advertising partner of Motley Fool Money. Citigroup is an advertising partner of Motley Fool Money. JPMorgan Chase is an advertising partner of Motley Fool Money. Sarah Sidlow holds positions in Bank of America and Berkshire Hathaway. The Motley Fool holds positions in and recommends Berkshire Hathaway and JPMorgan Chase. The Motley Fool maintains a disclosure policy.