A Biotech Trading Experiment …

By Travis Johnson, Stock Gumshoe, February 25, 2014

I almost never buy biotech stocks, thanks to my inability to understand the science or the marketplace very thoroughly without a lot of study, and thanks to the very precarious books of so many biotech companies … but I’ve been inspired by the overwhelming level of discussion on biotech stocks among Gumshoe readers in recent months, and I’ve decided to commit a little bit of capital to a few different biotechs that are generating great interest and substantial approval among our readers, particularly in the thread where karmaswimsami, Siva Panneerselvam, subramania kaushik, Alan Harris and a dozen or more other readers have been discussing up-and-coming stocks (and dismal ones) in the space.

But this time I’m doing something different … for me, at least. I am not going to try to fully understand the science, I am not going to become an expert on these stocks. I’m just going to place small bets on stocks I’ve learned about from readers and that look, after some brief research, to be reasonable speculations that have some financial viability and can be reasonably traded in the tiny chunks I’m considering, with market capitalizations at least approaching the $100 million neighborhood (and preferably a bit larger).

I’ll keep these bets small, both individually and in aggregate, and if the stocks do terribly I’ll set my stop losses on these at 50% … and will take some profits off the table if any of these stocks have large rises … and I’ll follow them, learn about them as I go, and watch from the sidelines as folks who love these stocks discuss them, but I probably won’t become an expert on any of ’em. I certainly haven’t researched any of them thoroughly enough to place big bets with my own money, or to suggest that anyone else buy these stocks … but I’ve told the Irregulars that I will share my personal stock buys and sells with you, so I’m telling you about these.

Which ones made the cut this time around? First buys in this great (or foolish) biotech trading experiment are:

Benitech Biopharma (BLT in Australia, BNIKF on the pink sheets)
Rexahn Pharmaceuticals (RNN)
Cellceutix (CTIX)

So … keep discussing ’em, folks, and I’ll keep absorbing the discussions and will let you know if I trade in or out of any others in the space. And yes, I am ...

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