Big Changes To BioShares Biotech ETFs: Who's In, Who's Out?

About: BioShares Biotechnology Clinical Trials ETF (BBC), BBP, Includes: ADAP, AGTC, AKAO, AKBA, AQXP, ARWR, CARA, CLCD, CRBP, DVAX, IMGN, MYOK, PDLI, PRTPX, PTI, RETA, RIGL, SRPT
by: Zacks Funds

Recently, the BioShares Biotechnology Clinical Trials ETF (NYSEARCA:BBC) and BioShares Biotechnology Products ETF (NYSEARCA:BBP) underwent radical changes in its portfolio construction. As per the source, the below-mentioned stocks entered and exited the funds.

Inside BBC

The fund follows the LifeSci Biotechnology Clinical Trials Index which gives exposure to biotech companies with a primary product offering that is in a Phase 1, Phase 2 or Phase 3 clinical trial stage of development (read: Small Caps Win on Trump Rally: 5 Top ETFs & Stocks).

BBC added Zacks Rank #3 (Hold) Achaogen Inc. (NASDAQ:AKAO), MyoKardia Inc. (NASDAQ:MYOK), Proteostasis Therapeutics Inc. (NASDAQ:PTI) and Rigel Pharmaceuticals Inc. (NASDAQ:RIGL). It also added Zacks Rank #2 (Buy) Aquinox Pharmaceuticals, Inc. (NASDAQ:AQXP), Cara Therapeutics Inc. (NASDAQ:CARA), CoLucid Pharmaceuticals Inc. (NASDAQ:CLCD), PIMCO Real Return Asset P (MUTF:PRTPX) and Reata Pharmaceuticals Inc. (NASDAQ:RETA). Corbus Pharmaceuticals Holdings Inc. (NASDAQ:CRBP) was also added to the fund.

Among the stocks that the fund washed its hands of are Zacks Rank #3 Adaptimmune Therapeutics plc (NASDAQ:ADAP), Applied Genetic Technologies Corporation (NASDAQ:AGTC), Akebia Therapeutics Inc. (NASDAQ:AKBA), Arrowhead Pharmaceuticals Inc. (NASDAQ:ARWR), Dynavax Technologies Corporation (NASDAQ:DVAX), ImmunoGen Inc. (NASDAQ:IMGN) and many more.

With this, BBC reduced its total number constituents from 75 to 70 stocks. It added 10 while removed 15 as these did not match the fund's stock-picking strategies. Notably, BBC is down 34% this year (as of December 16, 2016) and has a Zacks Rank #3 with a High risk outlook (read: 4 Frightful ETFs of This Year).

Inside BBP

BBP follows the LifeSci Biotechnology Products Index which deals with biotech equities that have a primary product offering or product candidate that has received FDA approval.

BBP included Zacks Rank #3 Sarepta Therapeutics Inc. (NASDAQ:SRPT) (which in fact was shifted from BBC to BBP on "receiving FDA approval and entering the Product stage for their lead drugs") while knocked out Zacks Rank #3 PDL BioPharma Inc. (NASDAQ:PDLI).

However, the total number of holdings were unchanged at BBP. The fund is up 10.6% so far this year (as of December 16, 2016) and has a Zacks Rank #2 with a High risk outlook.

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Editor's Note: This article covers one or more microcap stocks. Please be aware of the risks associated with these stocks.