Four Dividend-paying Biopharmaceutical Investments to Buy Use Genetics to Produce Growth and Income

The four biopharmaceutical investments to buy that use genetics include two biopharmaceutical industry giants that have been building their genomic capabilities in recent years, as well as two exchange-traded funds that offer some exposure to the sector and hold enough traditional pharmaceutical stocks to provide investors a modest dividend yield. I am among those who are hoping and praying that genetic research breakthroughs one day may provide long-sought treatments for muscular dystrophy, amyotrophic lateral sclerosis (ALS) and other diseases. “Biotechnology stocks have been doing well recently, and that’s likely to continue,” said Bob Carlson, leader of the Retirement Watch investment newsletter.

Two major pharmaceutical companies that have expanded into biopharmaceutical and genetic treatments heavily are New York-based Bristol-Myers Squibb Inc. (NYSE:BMY) and Eli Lilly (NYSE:LLY).iShares Biotechnology (IBB) is designed to track the NASDAQ Biotechnology Index. So, it holds only stocks listed on the NASDAQ that are classified as either biotechnology or pharmaceutical companies, Carlson said. IBB tends to be the more volatile of the two funds and, over some periods, its returns can be substantially higher or lower than alternatives, Carlson cautioned. The other ETF Carlson recommended is SPDR S&P Biotech (XBI). That fund aims to track the S&P Biotechnology Select Industry Index. That biotech index is derived from a U.S. total market composite, so it is not limited to S&P 500 stocks. Instead, XBI uses a sampling strategy to try to track the index instead of holding all the stocks in the index.

Source: Dividend Investor

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