Post by chang on Jan 17, 2021 22:30:15 GMT
I bought XBI a couple of years ago, I remember it was trading at $59. I added at $77, and then three more times as it kept bouncing upward off $100. So this was a very rare "buying higher" case for me, and generally a successful investment. It's only 2% of my equity, but I enjoy "being invested" in it. "Mad money" if you like.
Point being, when I bought it, there were only three major ETFs (SPDR's XBI, iShares's IBB, and Vectors BBH) and a few very small ones, plus FBIOX. I bought XBI mainly for it having equal weighting of small-midcap companies and no pharmas. It had the best historical record (albeit with the most volatility) of the four. That was pretty much the extent of my analysis.
Now I happened to see this article in Barrons (Want to Use ETFs to Play Biotech? Choose Wisely), which says:
"...biotech is a particularly difficult field for stock-picking. Investors might be better off with the more diversified funds. Some prefer early-stage firms; others like larger and more stable names. Some invest only in cancer-immunotherapy companies, while others are focused on leaders in genomics. Some include foreign companies, others are purely U.S.-oriented. Some consider corporate governance, pending litigations, or geopolitical events. Not surprisingly, the funds often have few similarities in holdings or performance."
A quick check of etfdb.com shows a whole slew of biotech ETFs now (etfdb.com/etfs/industry/biotechnology/), though only 6 with assets > $250M.
Reading the Barrons article, I almost get the feeling that you need as much industry expertise to pick an ETF as you do to analyze a single company stock, which would almost defeat the purpose of buying an ETF. OK that's an exaggeration, but the biotech ETF landscape does seem awfully variegated.
I doubt I would sell or move XBI or add another ETF, but I am interested to hear what biotech ETFs others have bought and own.
Point being, when I bought it, there were only three major ETFs (SPDR's XBI, iShares's IBB, and Vectors BBH) and a few very small ones, plus FBIOX. I bought XBI mainly for it having equal weighting of small-midcap companies and no pharmas. It had the best historical record (albeit with the most volatility) of the four. That was pretty much the extent of my analysis.
Now I happened to see this article in Barrons (Want to Use ETFs to Play Biotech? Choose Wisely), which says:
"...biotech is a particularly difficult field for stock-picking. Investors might be better off with the more diversified funds. Some prefer early-stage firms; others like larger and more stable names. Some invest only in cancer-immunotherapy companies, while others are focused on leaders in genomics. Some include foreign companies, others are purely U.S.-oriented. Some consider corporate governance, pending litigations, or geopolitical events. Not surprisingly, the funds often have few similarities in holdings or performance."
A quick check of etfdb.com shows a whole slew of biotech ETFs now (etfdb.com/etfs/industry/biotechnology/), though only 6 with assets > $250M.
Reading the Barrons article, I almost get the feeling that you need as much industry expertise to pick an ETF as you do to analyze a single company stock, which would almost defeat the purpose of buying an ETF. OK that's an exaggeration, but the biotech ETF landscape does seem awfully variegated.
I doubt I would sell or move XBI or add another ETF, but I am interested to hear what biotech ETFs others have bought and own.
