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Biotech ETF Hits Record: How Much Higher Can It Go?

TedTed
edited June 2015 in Fund Discussions
FYI: Biotechnology stocks Gilead Sciences (GILD), Amgen (AMGN) and Biogen (BIIB) were at the crest of Thursday’s stock rally, powering the largest biotech exchange-traded fund to a fresh record high.
Regards,
Ted
http://blogs.barrons.com/focusonfunds/2015/06/18/biotech-etf-hits-record-how-much-higher-can-it-go/tab/print/

M* Snapshot IBB: http://www.morningstar.com/etfs/XNAS/IBB/quote.html

IBB Is Ranked #8 In The (H/B) ETF Category By U.S. News & World Report:
http://money.usnews.com/funds/etfs/health-biotechnology-funds/ishares-nasdaq-biotechnology-index-fund/ibb

(If IBB closes at its present price it will be up 23.8% YTD)

Comments

  • I would personally wait until after the SCOTUS rules on the ACA subsidies before putting new money to work in a broad-based HC fund. BIO's may be sheltered, but other HC may take a hit if the court issues a surprise.
  • TedTed
    edited June 2015
    @PRESSmUP: You make an excellent point short-term. However, over the long-run I still believe health care and especially biotech funds will give enhanced returns.
    Regards,
    Ted
    http://www.cnn.com/2015/06/18/politics/obamacare-aca-supreme-court-exchange-state/index.html
  • There seems to be an explosion in biotech medical advances recently and it's resulting in a lot of M&A activity to push higher. It is reminiscent of the dot.com bubble, but as we've seen before, markets can go much higher than you would normally expect.
  • Ted...I bought VGHCX over 10 years ago because HC was a defensive sector. Funny how being cautious worked out, eh?
  • TedTed
    edited June 2015
    @PRESSMUP; Next time I go out to eat, I'm sending you the bill. A $10,000 investment in VGHCX 10 years ago in now worth $23,440--Nice work ! Note MFO Members what long-term comittment to a fund can bring.
  • No problem Ted....just email me the bill along with your bank account number and password so I can deposit the funds. Also, 10K invested would be $35,279.17 per M* so I can pick up dessert as well.
  • @Ted, M* says $10,000 become $35,280 in 10 years with VGHCX so you should probably send the bill for 2 dinners!
  • I guess the question for those with at least a moderately longer term view is - what's changed?

    With stuff like this:
    http://www.mutualfundobserver.com/discuss/discussion/21815/look-how-much-weight-we-ve-gained-since-the-1960-s#latest

    I just see continued tailwinds for healthcare. I don't know if I want to add too much more to the sector, but I'm open to adding more if I find things that compliment what I already own rather than adding more similar names.
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