The Key to Becoming a World-Class Biotech Investor
Back when I was growing up in India, nobody talked about the stock market. But I remember reading about the Great Crash of 1929 and found it fascinating. I’ve been hooked ever since.
When I was 6 years old, I was sent to boarding school, where I learned to be independent and make decisions and judgments on my own. After boarding school, I came to the United States at the age of 18 by myself. And since then, I’ve made the stock market my life’s great passion.
Steve Jobs said you should do what you love and the money will follow. I can tell you that’s true. When you do what you love, it’s not work. It’s just something you do, like breathing.
If you know the rules and play [the biotech sector] right, you can make a lot of money.
I’ve now had close to 25 years of investment experience, going through every kind of job in finance. I’ve covered biotech and healthcare as an analyst and portfolio manager for major international banks such as Deutsche Bank and ING. I’ve been part of a team managing a $23 billion mutual fund and a $6 billion hedge fund that Barron’s named one of the world’s best hedge funds in 2008.
While the stock market is perhaps the most competitive place in the world, I know you can beat Wall Street at its own game. It doesn’t matter that many of those stockbrokers went to Harvard or Yale or have doctorates (some doctors even quit their profession to try the biotech investing space).
I can say that because I outperform these guys on a regular basis, and my education comes from two places: direct experience and reading books.
Just by reading, I understand enough about molecular biology; and through my experience, I know how to profit from that knowledge in the markets. I’ve got a library of over 1,000 books, and I never stop buying more. On average, I read over 50 books a year over 100 email news items every single day.
I wouldn’t trade any of my experience and financial freedom for any degree in the world.
There was no established way to analyze biotech stocks when I first started in the field. These companies had new science, and no biotech company had established a tried and true business model as a beacon for others to follow. So I had to use my own ingenuity to come up with techniques to figure out when biotech stocks were cheap and when to buy them. And I’ll admit that I had to work out through trial and error when to buy and when to sell them.
I can tell you that biotechnology is a highly specialized area of investing. If you want to be successful in a specialized area of investing like biotechnology, you need to know the rules that can give you that success.
And I’ll share this secret with you because I know this from 25 years of investing…
Biotech investing is like the highest of high-stakes poker games in the world, with the sharpest of poker sharks playing. And if you don’t know the rules, you’re going to lose money — a lot of money. If you know the rules and play it right, you can make a lot of money.
Here’s an example…
On May 30, 2014, anyone who is anyone in the field of biotech, and specifically oncology, is going to be in Chicago.
What’s going on in Chicago on May 30, 2014?
ASCO? What’s ASCO? you’re probably wondering.
ASCO is the American Society of Clinical Oncology, and they host the world’s most prestigious medical conference.
You can think about it like the tech conferences where companies like Apple and Samsung release their latest gadgets and devices. These tech conferences draw tech geeks and journalists reporting on the latest and greatest electronic gadgets, and new information comes out during these events that can move stock prices. So investors attend these conferences as well.
The ASCO conference is held once a year. ASCO is attended by oncologists, investors, medical geeks and others, all who attend to find out about the latest and greatest cancer treatments.
I’m sure you don’t need to be told this, but cancer is one of the world’s biggest medical needs. The American Cancer Society estimates that “in 2014, there will be an estimated 1,665,540 new cancer cases diagnosed and 585,720 cancer deaths in the U.S.”
The American Cancer Society’s 2014 factbook states that 44% of all men are likely to develop cancer in their lifetimes and 23% are likely to die from it. The fact book also states that 38% of women are likely to develop cancer in their lifetime and 19% are likely to die from it.
Spending on cancer drugs by U.S. employers and health insurers is soaring. In 2012, global sales of cancer drugs are estimated to have hit $80 billion.
Biotech companies are focused on finding new ways to help cancer patients. I believe that this is an opportunity that creates winners all around. If biotech companies find new drugs to help patients, that’s good. And if that helps them make money, that’s good too.
And one of my focuses is to find you companies that have incredible new cancer drugs. And make a ton of money in the process.
P.S. I left the daily hedge-fund grind, managing billions of dollars, to come to The Daily Reckoning. I want to help you beat the street. The first step is for you to sign up to receive our daily commentary by email. A full 50% of all the content we publish is reserved for subscribers only. Signing up is free, simple and will help you grow your portfolio. Click here to sign up for the DR now.