Biotech ETF Surges On Positive Trump Comments

January 31, 2017 5:51pm NASDAQ:IBB

donald trump

The iShares Nasdaq Biotechnology Index Fund (IBB) outperformed all other non-leveraged, non-inverse exchange traded products in the U.S. today on a dollar basis, producing a +2.84% one-day return and outperforming the wider markets by a total of 2.85 percentage points.


Behind The Gains

IBB closed today at $278.07 per share, up $7.68 (+2.84%). Putting this move in context, the S&P 500 index — largely considered the most popular and useful benchmark for equity performance — closed down $0.02 (-0.01%) on the day.

IBB’s trading volume today was a total of 2,650,811 shares, which was an increase of 65% versus its average daily trading volume of 1,604,860. Rising trading volume generally an indicator of increased demand for a particular security, and is typically associated with a specific news event or trend that draws investors into or out of specific asset classes, or sectors or subsectors within those classes.

Including any dividends as well as today’s gains, IBB has now returned a total of 4.78% year-to-date, versus a 1.79% gain in the S&P 500 during the same timeframe.

A Look Under The Hood

iShares Nasdaq Biotechnology Index Fund is an Equity-focused product issued by BlackRock. Its expense ratio of 0.47% makes it the #19 cheapest ETF among 35 total funds in the Health & Biotech ETFs category.

IBB currently boasts $7.79B in assets under management (AUM), placing it #2 of 35 ETFs in its category, and #72 of 1922 total ETFs in the U.S. exchange traded universe.

The investment objective of the iShares Nasdaq Biotechnology ETF seeks to track the investment results of an index composed of biotechnology and pharmaceutical equities listed on the NASDAQ.

The reason behind today’s gains was President Trump’s commentary that he’d favor pushing the FDA to allow new drug treatments to come to market faster. This was some much-needed positive news for the industry, which has been stuck in a slump dating back to mid-2015.

IBB SMART Grade

IBB currently has an ETF Daily News SMART Grade of B (Buy), and is ranked #9 of 36 funds in the Health & Biotech ETFs category.

For more information about this ETF, including full ratings, news, data, and more, please visit IBB’s ticker page.

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