Alternative Investments: A New ETF for Infectious Disease Companies is Called GERM

June 22, 2020 | Alternative Investments, News
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ETF Managers Group launches a thematic ETF in tune with the times.

The ETFMG Treatments, Testing, and Advancements ETF (NYSEARCA: GERM) is a new fund from the stable of ETF Managers Group or ETFMG. It offers investing exposure to companies engaged in the testing and treatment of contagious diseases. (Bloomberg)

The GERM ETF

The ETF tracks the Prime Treatments, Testing, and Advancements Index, a basket of advancement, testing, and treatment companies “designed to include the securities of companies engaged in performing research, development, and commercialization of treatments, vaccines, or biological testing for infectious diseases.”

Through the ETF, investors can get exposure to both established companies as well as the “unsung heroes.”

These are companies that soldier on to protect us from disease outbreaks.

For context, from January 2011 to January 2018, there were 38 epidemic events in the U.S.

Further, there are currently over 20 combined pandemics and epidemics affecting the world today.

The GERM ETF commenced trading Thursday, even as fears mount of the second wave of infections from the coronavirus.

As a regrettable fallout of the COVID-19 pandemic, the human vaccines market is expected to grow to $72.5 billion by 2024, according to ETFMG.

Moderna a top holding for GERM

Moderna Inc (NASDAQ: MRNA) is a top holding in the GERM ETF. The company’s CEO said Thursday that there was a good chance that the company’s COVID-19 vaccine would be available in 2021. It is currently preparing to launch a Phase-3 trial of the vaccine in July.

The stock price of Moderna has more than tripled this year.

“GERM represents an investment theme that is much more than topical, it provides unique exposure to a previously underrepresented growth sector within biotech,” said Sam Masucci, CEO and Founder of ETFMG.

“We tried to develop a product of all the companies at the forefront that will hopefully get us back to a more normalized life,” Masucci told Bloomberg.

The expense ratio of GERM is 0.68%.

Other biotech ETFs are up solidly this year

  • The iShares Nasdaq Biotechnology ETF (NASDAQ: IBB) +10.77% YTD
  • VanEck Vectors Biotech ETF (NASDAQ: BBH) +14.40%
  • SPDR S&P Biotech ETF (NYSE: XBI) +11.29%

Related Story:     Corona Spawns a Scarily-named ‘Biothreat’ ETF Theme

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