Biotech Values

[biomaven0]

>>what the Fed will do to interest rates would be significantly off topic on this board

If you look back over the years you will see that biotech bull and bear markets correspond significantly with easy/tight money from the Fed. The story of 1999/2000 is significant.

Non-profitable biotechs share one thing in common - they all have finance risk. When there is lots of money sloshing around, they get their share; when money is tight, look out below.

Any investment that has a long time horizon before turning profitable has a significant interest rate component in its valuation. It may not be as obvious with a biotech as it is with a company building a big petrochemical plant, but trust me it is still there.

Peter