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March Biotech Sell-Off: ETF Watch... XBI Vs FBIOX

|Includes:SPDR Biotech ETF (XBI)

XBI Outperforms FBIOX YTD

Many biotech stocks sold off today despite a strong market on weak volume as industrials and tech were up about 1.4%. Watch the ETFs compared to Fidelity FBIOX because the sector is more volatile this month.

Here is a chart comparing three ETFs:

Chart forSPDR S&P Biotech ETF (NYSEARCA:<a href='' title='SPDR Biotech ETF'>XBI</a>)

XBI took off in January racing ahead of the others including FBIOX. The XBI says they are equal weight but does frequent re-balancing of positions. Among their top holdings are Intercept (NASDAQ:ICPT), Aria (NASDAQ:ARIA), Sangamo (NASDAQ:SGMO),Intermune (NASDAQ:ITMN), Synageva (NASDAQ:GEVA), and Novavax (NASDAQ:NVAX) all of which are speculative stocks meaning hard to measure by financial metrics. Today XBI was down 1% after hours probably due to rebalancing with ICPT down 11.9%. Novavax was down 2%. In contrast IBB was up 0.67% although off highs of the day. Fidelity Select Biotech Fund (MUTF:FBIOX) was flat for the day.

So year to date FBIOX is up 17.5%, the IBB is up 12.5%, and the XBI still up 20.78% but the race is tightening.

We will do a complete review of all ETFs with Fidelity FBIOX at the end of March. Stay tuned.

The 2014 highs for all of these Funds and ETFs is late February.

Disclosure: long FBIOX, short XBI as a hedge only against a biotech portfolio.

Disclosure: I am long XBI.

Additional disclosure: Trading short in XBI hedging biotech portfolio. Long Fidelity Select Biotech (FBIOX).

Stocks: XBI