ETF Trends
ETF Trends

There has been mixed news on biotech stocks and exchange traded funds (ETFs) this year.  Large-cap biotech has been hurt by concerns on drug safety, tightened Medicare reimbursement and new competition from generics, reports Karen Anderson for Morningstar. Small-caps have fared well due to positive clinical data and takeover speculation. And as baby boomers age they’ll need the benefits of biotech.  Investing in biotechnology can be confusing so a basket of biotech stocks such as an ETF can be helpful.  Some of the biotech ETFs include:

  • iShares Nasdaq Biotechnology (IBB) – Celgene (CELG) makes up 6% of IBB and CELG recently got FDA approval on a cancer blood cells treatment.  IBB is up 4.9% year-to-date.
  • SPDR S&P Biotech (XBI) – Fifty-two percent of this ETF is made up of small-cap biotech companies.  XBI is up 23% year-to-date
  • First Trust Amex Biotechnology Index (FBT) – The 20 holdings in this ETF span across large- mid- and small-cap stocks.  FBT is up 6.8% for the year.
  • Biotech HOLDRs (BBH) – This ETF has predominately large-cap stocks, with Genetech (DNA) and Amgen (AMGN) making up 60%.  BBH is down 5.1% so far this year.
  • PowerShares Dynamic Biotech & Genome (PBE) – Small-caps make up about 45% of this ETF, which is up 7.3% this year.

The opinions and forecasts expressed herein are solely those of Tom Lydon, and may not actually come to pass. Information on this site should not be used or construed as an offer to sell, a solicitation of an offer to buy, or a recommendation for any product.