Good Reasons to Stick With Biotech ETFs

Helping the sector’s prospects is a speedier approval process by the U.S. Food and Drug Administration. In 2012, the FDA was given the authority to designate certain drugs as a ‘breakthrough therapy,’ which then allowed that drug to move through the approval processes more quickly,” said Morningstar.

The White House is also looking to help the Food and Drug Administration (FDA) expedite new drug approvals, which could serve as a major catalyst for the biotechnology space.

“As well, demographics in America–more people are getting older–and emerging-markets countries getting better access to medicine should also keep business booming for the foreseeable future,” said Morningstar.

ETF traders who are betting big on the biotechnology sector rebound have also utilized leveraged long options including the Direxion Daily S&P Biotech Bull Shares (NYSEArca: LABU), which takes the 3x or 300% daily performance of the S&P Biotechnology Select Industry Index.

For more information on the biotech sector, visit our biotechnology category.