This chart does not reflect the carnage that has occurred in the second- and third-tier since the portfolio was initiated at market close on 7/31........
iqc.com
Nonetheless, it gives a good feel for the continuing slump in biotech.
>> I attended an Informed Investors Forum one week ago in San Francisco. A keynote was delivered by Peter Freudenthal of BA Roberston Stephens <<
At the same meeting, Kurt Von Emster, manager of relevant Franklin funds, said that he expects biotech to rally in September. This is one problem with the T/FIF portfolio..... while it is composed of deeply discounted promise, it will be competing for investor attention with high-quality, whomped-on stuff like INCY......
iqc.com
The best biotech investors that I know of.... those that survived this slaughter by being largely in issues like SEPR, ADRX, BGEN, etc...... what are they doing? They are not, to my knowledge, embracing the T/FIF concept..... they are focusing on quality, higher-priced issues that have been pounded and on companies that sustained little downside due to rapid growth of product sales.
At the end of July, Von Emster said that, while it was not overwhelming, there was cash flowing into Franklin for biotech and that he was looking to move to a fully invested position. Among his "negatives" for the sector, stuff to avoid, he listed early-stage companies with less than $100M market cap. He also said to avoid platform companies, particularly those involved with microfluidics or genomics.
You can't knock, for its predictive nature, the advice that Von Emster gave in July. However, I know from past success that the really big profits in biotech are garnered by bucking up against dogma. You just need to pick the correct stocks. Isn't anyone interested in making suggestions? |
