Innovation is the mother of lucrative investing, and nowhere is that truer than in biotech - which delivers some of the best investments you'll ever find.
Biotechnology provides breakthrough products and technologies to combat debilitating and rare ailments, it reduces rates of infectious disease, tailors treatments to individuals to minimize health risks and side effects, creates more precise tools for disease detection, and it reduces the odds of global life threatening conditions.
In short, biotech helps to heal the world.
"If you're looking to double your money, the biotech sector is one of the best hunting grounds that you'll find," writes Money Morning Tech Specialist Michael A. Robinson, who regularly follows the industry's best investments for his Strategic Tech Investor members.
Best Investments in Biotech in 2013
Of late, the industry has indeed enjoyed a healthy showing.
In Q1, the Nasdaq Biotech Index carried over its robust performance from late 2012, gaining 16.7%. Credit significant product approvals, positive clinical trials and sold business outlooks for the sustained momentum and outperformance versus the broader market.
The Index recently hit a record high, leaving many to wonder if the sector is poised for a pullback.
The consensus views are fundamentals remain favorable, the sector still exudes strength and the biotech rally has legs.
Sharing that sentiment is Evan McCulloch, co-manager of the Franklin Biotechnology Discovery Fund, one of the best performing health care funds tracked by Morningstar.
"Biotech, especially the big companies, are coming off some very low valuations. From 2009 through 2011, the sector underperformed the broader stock market. Wall Street, having once believed drug makers were unable to make research and development spending pay, now has come to realize that it pays for companies to invest in drug discovery and development," McCulloch told Barron's.
Thanks to a more receptive Food and Drug Administration (FDA), fresh drug pipelines and resurgence in M&A activity, the sector is in a sweet spot. Big players are flush with cash, and smaller troupes are ripe with promise--the perfect combination for fruitful research and development.
Best Investments 2013: How R&D is Paying Off for Biotech
Since the discovery of DNA in 1953, and the identification of DNA as the genetic material in all life, advances in the vast area of biotechnology have been astounding.
But because of the extremely high costs of R&D, coupled with scant revenue in the early years of development, funding is tight. Moreover, companies experimenting in R&D often see their valuation diminish since they provide little return for shareholders.
Lately, however, there's been a profitable development in the sector...