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High-volatility ETFs target biotech, micro-caps, and junior gold miners
The Virtus LifeSci Biotech Clinical Trials ETF has gained about 38% year to date, but it charges a 0.65% annual fee and may face liquidity constraints due to low AUM and trading volume.
MarketBeat Ratings highlights three exchange-traded funds that aim to give investors targeted exposure to high-volatility areas, including clinical-stage biotech, micro-cap stocks, and junior gold mining companies. For clinical-stage biotech, the Virtus LifeSci Biotech Clinical Trials ETF (NYSEARCA: BBC) holds a basket of 135 companies in the drug development and trial phase, where many names are pre-profit and smaller, with more than half categorized as small-cap and large companies representing under 1% of the portfolio. MarketBeat Ratings also points to deal and pipeline tailwinds this summer, saying BBC appears to have benefited this year, with the ETF climbing about 38% year to date. MarketBeat Ratings notes that despite diversification benefits, BBC remains a risky vehicle given that each constituent faces pressure to succeed before cash runs out. The outlet adds that the fund’s annual fee is 0.65% and liquidity may be a concern because of low assets under management and limited trading volume. In micro-caps, the iShares Micro-Cap ETF (NYSEARCA: IWC) is designed to track the Russell Microcap Index, which includes small, highly volatile firms, and the article frames the fund’s approach as a bet that a subset of holdings could outperform. The piece also references exposure through a junior gold miners ETF, the SPDR S&P Junior Gold Miners ETF (NYSEARCA: GDXJ), though the provided text cuts off before detailing its specific holdings or performance.
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