One investor has launched a new equity trading fund (ETF) that focuses on investing in pharmaceutical and biotech companies that are striving to develop immunities to cancer.
Biotech blogger and investor Brad Loncar is offering the Loncar Cancer Immunotherapy ETF (CNCR). The ETF will invest into companies that try and combat cancer by using drugs designed to modify the immune response of the body. By changing the body’s immune response, it will be able to attack any cancerous cells that have taken over.
The ETF holds a total of 30 pharmaceutical and biotech companies, all of which are working to beat cancer. Some are large names like Bristol-Myers and Pfizer, while others are virtually unheard of, such as Ziopharm Oncology and Bluebird Bio.
While it is definitely a niche ETF, focusing on a very exclusive area in the market, the newly established fund seems to be performing well so far.
It’s worth mentioning that Loncar chose a particularly poor time to launch the ETF. The biotech industry recently took a downturn after Democratic Presidential Candidate Hillary Clinton promised to fight against price gouging in prescription medication.
However, it isn’t all bad. The biotech sector has been one of the strongest industries over the previous decade, offering investors a 300% return.
Interestingly, the CNCR ETF is giving each individual stock in its portfolio an equal weighting. The performance of smaller companies in the portfolio will have just as much of an impact on CNCR as the household names. This should cause the ETF to be somewhat more volatile than average. The ETF will charge investors 0.48% of their investment in the fund every year.
Loncar believes that focusing on a particular area of the biotech industry will help make investing easier on his part.
Loncar says, “A goal is to take biotechnology and break it down into one of its individual components, like cancer immunotherapy, that people are specifically interested in. It’s a more straightforward and efficient way of looking at a sector.”
A similar ETF that also focused on cancer treatment and prevention existed a decade ago. It was called HealthShares Cancer ETF (HHK). It failed miserably, as the ETF had to liquidate in less than a year. Loncar obviously hopes to have more success than this predecessor.