Biotech stocks have been hit hard on concern that rising rates lower the value of future profits, and that Washington may force Covid vaccine developers to make patent details public… so much for intellectual property rights. The S&P 500 Biotech ETF (XBI) has fallen 31% since March, and while weeks of selling have certainly tested my patience, historical data gives me hope that the selloff is nearly over. We have witnessed six notable drawdowns in the sector since 2011, with an average decline of 35%… at 31%, we’re pretty darn close. Critically, each of these nasty selloffs was followed by a sustained and significant rally. As for politicians and The Fed, I have a hard time seeing Washington trampling on decades-old IP protocols… especially in light of on-going negotiations with China… and Friday’s disappointing jobs data should keep rate hikes at bay. My fingers are crossed.
As of 5/10/21, the author holds positions in:
Allakos, Inc., Applied Therapeutics, Arconic Corp., BioDelivery Int’l, Inc., Boeing Company, Boston Properties, Inc., CVS Health Corp. , Energy Transfer LP, Evofem Biosciences, Inc., Herman Miller, Inc., Inovalon, Inc., Iveric Bio, Inc., JAMF Holding, Inc., L3Harris Technologies, LifeSci Acquisition II Corp, Neoleukin, Nine Meters Biopharma, Nutanix, Inc., OMC Group, Inc., Ontrak, Inc., Progenity, Inc., Progyny, Inc., Rapt Therapeutics, Inc., Shift Technologies, Inc., SmileDirectClub, Inc., SOC, Telemed, Inc., Teladoc Health Inc., The RealReal, Inc., Trillium Therapeutics, Velodyne, Inc., Wynn Resorts, Ltd., Workhorse, Halliburton, NXP Semiconductors
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