Biotech Stocks Cruise Through The Volatility

Biotech Stocks Cruise Through The Volatility 

  • Large-cap Biopharma Offers Value at a Reasonable Price.
  • Time to Nibble on Hyper-growth small-cap stocks.
  • Watch for Bounce in ARKG and XBI to Add Beta.

We recently covered valuations and performance of Large Cap Biotech stocks and found that they were a good anchor to any portfolio because of a low PE  with dividends yet outperforming NASDAQ YTD. Over the past week with market volatility exacerbated by Bitcoin trades, you can see in the chart below that healthcare and biotech prices were stable.

The XLV Healthcare Select SPDR is up 10% YTD. This would be a safer way to play the overall sector as per our recent article on Diversification.

As we approach the ASCO Meeting in early June we should get traction from clinical data presentations in immuno-oncology. Some favorite stocks today are already moving today as of 2:30 p EDT trading in anticipation of product pipeline news: BMY, LLY.  Other movers today are MRNA, NTLA, RETA

This good is a good time to add beta to your portfolio as the small-cap, equal-weighted XBI is in bottoming process at the $125 level. The XBI reached highs above the $170 level in the speculative blowout just recently in early February.

We have begun a new small trading position in the volatile ARK Genomic Revolution ETF (ARKG) to add beta to our portfolio. We added at $78 and looking for a move to $90.

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Disclosure: None.

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