Profit Pregame

What I’ll Be Investing in Instead of Chasing Every New Vaccine “Breakthrough”

The vaccine race continues…
Not every biotech company is doing well in the search for a vaccine.

What’s happening?

As the pandemic continues to rage on, the race to develop a vaccine continues as well. Since day one, companies came out of the woodworks to throw their hat into the ring – hoping to be the first to develop the coveted medical breakthrough.

As coronavirus rages on, companies continue to struggle to come out on top. And one of the newest victims in Eli Lilly. Since the beginning, Lilly has been part of the race to develop a treatment, searching for authorization for its antibody treatment.

But the company has yet to find solid ground to stand on.
Where’s the money?

Eli Lilly has not only struggled to find a vaccine, but Lilly also fell short of analysts’ expectations for third-quarter profits. And this was all thanks to the increased costs to develop possible Covid-19 therapies. But the drop in revenue isn’t the only thing putting the stock in a bad light.

Earlier this month, the Eli Lilly trial was paused due to safety concerns. And a day before the earnings announcement, it was announced that no additional Covid-19 patients that had been hospitalized would receive its treatment. This decision was made after data from a government-run trial revealed that the therapy was failing and was unlikely to help patients recover as the company has hoped.

And if I’m honest, I wasn’t all surprised to see this bad news surrounding Lilly. Here’s why…

How do I get some?

To me, it’s interesting that so many investors chase companies that made noise about a possible vaccine. It’s as equally interesting that despite months and months without a vaccine, investors are still running after those same stocks, pushing the stock higher with any whispering of a” breakthrough. “

The reason why I find it so interesting is that it’s pretty well-known that pharmaceutical companies don’t make much money on vaccines or drugs. LLY spent nearly $400 million pursuing this vaccine but haven’t been left with much but a downturned stock and revenue loss. Not a good look for this company or its investors.

And that’s precisely why I’ve stayed away from pouring money into vaccine dream chasers.

But there is a way to invest in the race to the vaccine. It’s just not the way you think. SPDR S&P Biotech ETF (XBI) tracks the biotech sector – and it’s the perfect place to put your money amidst the uncertainty of a vaccine. The way to play it? Look to short this ETF on any rally – and then, take your money and run.

In the spotlight: 2020 – the year of IPO…

The Hummer used to be one of the most popular cars of its time. Jampacked with exciting features and a sleek, modern look – consumers bought them up quickly. But then they faded slowly into the background as new, more advanced models came to market.

The Hummer is back, though, and it’s a much different vehicle than it used to be. General Motors revealed the new all-electric GMC Hummer EV recently, bringing the Hummer brand back after years. And this is a pretty big switch up from the name Hummer built for itself back in the day. The vehicle was known to be a rugged, off-road warrior often criticized for burning through gas quickly.

But this switch by Hummer to go green and create a more eco-friendly vehicle improved not only the vehicle’s impact on the enviroment but also improved on-road and off-road handling. And this switch to electric didn’t lead to a loss of power. The Hummer comes loaded with four-wheel drive and three electric motors, which can produce 1,000 horsepower.

The industry of eco-friendly automobiles continues to grow daily. So, I think this was a smart choice by General Motors – and truth be told, GM has been making a fair amount of intelligent decision lately. With that said, I’ll be keeping a close eye on this company, and I’ll be sure to keep you updated.

Navigate Market Volatility with this…

With the vaccine race yet to yield a true winner, many investors are left undoubtedly disappointed…

I hate watching people try to chase money by following the news headlines – because there’s so much information they leave out.

Do you know who else hates this? My colleague, 3-decade trading expert Shah Gilani, who also happens to be Money Morning’s Chief Investment Strategist. That’s why he wanted me to invite my Profit Pregame readers to his first-ever stock-picking lightning round event.

During this event, he’ll be flying through stocks – over 50, to be exact – telling you which to consider buying NOW and which not to touch with a ten-foot pole.

This could be the largest buying opportunity in stock market history… click here now.

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