It’s one thing to discuss the economics of investing in the biotech sector, but it’s another to discuss genomics. The sub-sector of the biotech industry has seen strong growth as evidenced by the over 60% gain year-to-date for the Global X Genomics & Biotechnology ETF (GNOM), according to Morningstar performance numbers.
GNOM seeks to provide investment results that correspond generally to the price and yield performance of the Solactive Genomics Index that is designed to provide exposure to exchange-listed companies that are positioned to benefit from further advances in the field of genomic science and biotechnology, as well as applications thereof (collectively, “Genomics & Biotechnology Companies”), as defined by Solactive AG, the provider of the underlying index.
GNOM gives investors:
- High Growth Potential: GNOM enables investors to access high growth potential through companies that are positioned to benefit from further advances in the field of genomic science.
- Targeted Exposure: GNOM provides access to emerging areas within the Health Care Sector at the intersection of science and technology.
- ETF Efficiency: In a single trade, GNOM delivers access to dozens of companies with exposure to the genomics theme.
“It has been an eventful year for the volatile biotech sector, which has been in the spotlight from the onset of 2020, owing to the coronavirus outbreak,” a Nasdaq article said. “The Nasdaq Biotechnology Index witnessed a roller coaster ride with a 28.4% gain in the year so far, riding the coronavirus wave.”
As the deployment of a global vaccine continues to be underway, this could help propel the biotech sector even further. With innovations in genomics, researchers can get further data on how the virus behaves and thus, combat the pandemic more effectively.
“Needless to say, the development of coronavirus vaccines and treatments has been in the forefront throughout 2020 and gained further steam, of late, as the second wave of the pandemic grapples the world, resulting in more and more fatalities with each passing day,” the article added. “Desperate times call for desperate measures. Hence, biotech companies are running a race against time and currently evaluating every possible weapon in their arsenal to combat this outbreak. While most companies are developing vaccines to prevent the spread, a few like Regeneron are also working to develop antibodies for the virus. Any positive update in this regard has led to a surge in the share price of the respective company.”