Spdr S&P Biotech Etf (XBI)

The sector has had a great bounce since March lows. A good way to play the COVID vaccine race. IBB is the best-known biotech ETF, but he does the XBI, because it's equal-weighted. XBI has had a great bounce. It's a great sector with reasonable valuations. The race for a COVID vaccine is a tailwind, of course. Biotech is a slow-growth area, which benefit from interest rates staying very low for the long term.

(A Top Pick October 10/17 Up 0.2%) He stepped out of this a month after they recommended it. It broke down on the relative strength measure and has not done much else since. He likes the healthcare space still however.

This is equal weighted, so you are getting a split between the big hefty diversifieds. M&A, which has been highlighted by Gilead, is definitely driving the sector now. At the same time, you are getting the basket approach of the big guys, you are incorporating the small guys as take-out targets that give you the big premium. There is a slightly softer regulatory environment where more drugs are making it to market.

He likes biotech. This ETF will be an equal weight of all the names, so you are going to get some of the smaller cap names, which will have benefited you. Thinks there is lots of growth left in this space.

Biotechs have a strong seasonality that starts in July, so right about now you should get a nice move. It has a historical 100% gain potential in July. Believes that healthcare and biotech specifically is probably the next thing that is going to move the needle for humanity, so he would accumulate this on a long-term basis. Owning this for 10 years will be a good thing.