3 Best Performing Biotech Funds So Far In 2019

The biotechnology industry has surpassed the S&P 500 so far this year, turning up as one of the best performers this year. The better-than-average performance of the industry has been mainly driven by mergers and acquisitions, initial public offerings (IPOs), introduction of biosimilars, collaborative operations, rising use of AI and new job opportunities.

In fact, the major biotech ETFs and indexes have performed impressively so far this year. The SPDR S&P Biotech ETF (XBI) has gained 26.7% year to date, while the ProShares Ultra Nasdaq Biotechnology (BIB) added 38.4%.

Biotechnology mutual funds are good investment options regardless of how the financial markets are performing. Investors who wish to make the best of the biotechnology industry’s gains could consider investing in mutual funds focused on biotechnology companies.

M&As, IPOs & Tie-Ups Keep Biotech in the Limelight

The biotechnology sector has been in news since the beginning of 2019. A significant number of companies participated in mergers and acquisitions. In January alone, two major deals were signed. First, Bristol-Myers Squibb Company announced that it will acquire Celgene Corporation. The acquisition was finally completed in November 2019.

Takeda Pharmaceutical Company Limited completed the acquisition of Shire in January. In the very next month, Eli Lilly and Company acquired Loxo Oncology. This acquisition extended the scope of the former’s oncology portfolio into precision medicines via the addition of an array of highly selective potential medicines for patients that suffer from genomically defined cancers. There were many other such deals announced during the period.

The number of IPOs has also been vast in 2019. In fact, the numbers have been rising steadily over the last couple of years.

This is because biotechnology firms call for much financing, particularly when they advance in their research. Going public not only makes it easier to take care of the financing they need but also gives them more visibility in the industry. This may open up opportunities for acquisitions and collaborations, later on, thus helping the company.

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