The top five holdings of this biotech fund are: Inovio Pharmaceuticals Inc (INO, 2.03% of assets); Invitae Corp (NVTA, 1.84%); Novavax Inc (NVAX, 1.80%); Amicus Therapeutics Inc (FOLD, 1.35%); and OPKO Health Inc (OPK, 1.35%).
SPDR S&P Biotech ETF (XBI)
From Moneyletter
SPDR S&P Biotech ETF seeks to mirror the S&P 500 Biotechnology Select Industry Index. The index and ETF provide industry exposure across large-, mid-, and small cap stocks, with primary exposure in the mid- and small-cap range. The ETF will hold roughly 130 companies and takes a modified equal weight approach, meaning you will not see the top 10 holdings representing a majority percentage of total net assets. At the end of the second quarter, the Top 10 were 14.3% of total net assets.
Looking at performance, XBI has easily outperformed the S&P 500 year-to-date (as of July 31, 2020) and over the past trailing year. When evaluating this fund, though, one has to keep in mind the volatility of the biotech industry. It is driven by the success or failure of the research and development. This trait is important because it leads to specific companies being capable of turning in some very big gains over a short period of time or, conversely, some very big losses.
Brian W. Kelly, Moneyletter, moneyletter.com, 800-890-9670, September 2020