Familiar Faces:
When investors have an uncertain market environment thrust upon them they tend to revert to things that are recognizable. That is often larger cap names that have been around the block a few times. Names in the top 10 of the mega cap-related plays of the IBB include BIIB AMGN VRXT and GILD. Inside the top ten of the XBI are the same names but at a much smaller weight. the top component in the XRT comprises less than 1.5% of the fund while the more concentrated IBB shows GILD making up 8% of the ETF. Below shows the PRICE action between the two and the IBB in the last several weeks in flexing its muscles. Over the last 3 months, the IBB has added 13% and the XBI 4%. Overall it is nothing new as the IBB is 14 off its most recent 52-week highs and the XBI is 31% off its annual peak. The IBB on Tuesday successfully tested its rising 50-day SMA for the first time since the break above the double bottom breakout pivot of 129.05 taken out on 10/28, often an optimal entry.