Jun

9

I'm convinced (*) that it's a great long term idea to just buy-and-hold IBB , the biotech etf. It's some kind of hybrid between market  and equal-weighted, so that you do get a big slug of the big names like BIIB and AMGN, but it also saves room for the small and micro-caps. 25% of the portfolio is either small or micro, and another 19% is medium.

Fidelity's biotech fund has beaten the market since 1988, and I'd guess that biotech was more of a high-flier in 1988 and more reasonably priced now. Anyway the performance of the Fidelity fund is evidence that a fair number of biotech stocks tend to work out very well, well enough to overcome the duds.

* partly via reading Michael Brush, although he tends to recommend individual biotech stocks rather than the etf


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  1. Dash of Insight| Weighing the Week Ahead: The Fed, Brexit, and the Markets on June 12, 2016 1:41 am

    […] Charles Pennington notes the long-term success of biotech, using the Fidelity biotech fund as evidence. A better buy than in 1988? […]

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    […] Charles Pennington notes the long-term success of biotech, using the Fidelity biotech fund as evidence. A better buy than in 1988? […]

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