HOW TO Day Trade BIOTECH STOCKS & Find Out When Pharmaceutical stocks have FDA APPROVALS.

All right, what's going on guys this is josh answers here from the trading fraternity Uh, make sure you guys like this video if you've learned something and actually like it Also, make sure you guys subscribe to the channel. Uh, what i'm going to talk about today is pharmaceutical stocks, uh How to day trade them and guess how to spot them is more or less than what I want to go over I want to show a biotech that I recently played Uh, it's a little bit more I have made a video on this because you know What I will tell you guys biotechs are risky, uh to say the least it's pretty much a coin flip, you know What you're betting on is are they getting drug approval? So I want to go over how you guys spot these how you guys could even read the filings and what? What they kind of mean, you know, you don't really have to be a doctor to understand this but being able to say hey You know This is when fda results are going to come out and how to position yourself to profit off it and you know Why I say that is because you know with the market as high as it is today, uh These are kind of where I see the only opportunity. However, the opportunity gets negated simply by the fact it's a coin flip You really don't know Where these drugs are going to go in terms of pricing do they have you know? Anything that has a potential to go up that crazy has a risk But you know if you go watch uh, one of my other videos, you know Because i've criticized people who've said biotechs or you know, don't trade biotechs. It's dangerous But they have opportunity in them. The whole idea is to kind of go through these steps, which i'm going to show you guys to Negate the the risks I guess or not negate them but minimize your risk. So you're not totally just Going in and blindly doing it and you know what I want to start with it even relates to options trading I'm going to show you guys Uh this play that I made recently I made a couple days ago and before I tell you guys You're going to see it in my portfolio. I own it. These are all the shares I own I will probably buy more, uh after they get approval if they get approval, but You know don't take this as a recommendation Uh, because it's already up 60 percent from when I bought it I'd be very very careful trying to get in it. But what I want to show you guys is um Where is it? It's not this stock Uh, where did it go? Where did it go friend? What the heck just happened? Huh Ah new day so That's what happened but That's actually really weird so Really what I want to show you guys here is it's ak, uh tx as you guys see here I bought it at four three. That was uh the beginning of the month here So seven days ago and i've already got 50 on it I bought it around 12 70 after that's after my commissions and I bought 50 shares of it. So The thing with it is that's so interesting about all of it Is that I didn't play options with this not because it didn't have options, you know in here, you know If we go to the chart, um ak tx It had option it doesn't have options But why did I play it because you know, I went 50 shares in that 12 bucks a pop, you know My max risk if that thing, you know, i'm assuming that goes to zero that's 600 bucks, you know Now it's worth the what about like 900? Uh, you know what i'm saying? It's not like I made but then again, that's 50 percent But it was earlier at 22 bucks, which was great. And you know why i'm gonna go tell you guys how I found this But the key I want to point out here is I bought shares instead of buying options, you know And a lot of people think I only trade options. Uh, not at all, you know, i've made most of my money trading shares That's why I started with it. It's about under you know, the real good options traders understand When to use options when to use stocks, you know, like I always say, you know This is just the dynamic of options trading. You can't trade options unless you know how to trade stocks It's you know options are a derivative of it. So That's why in this case, you know, especially when you're playing these pharmaceuticals companies The options are very risky because they're gonna have a lot of premium, you know, if you go check any uh, pretty much any um Biotech company they're gonna have a premium. Here's actually one i'll go over to the filing. I actually want to look at this one Tomorrow I think it's a dollar. It's probably not gonna oh they have options see so now here's this is a perfect example Um, you know, i'm actually kind of interested in them because they have a fda report coming up here I do not own anything in it. But the thing with them Is I want to look at their history, but i'll get into why I want to look at their history So this history isn't as appealing to me sadly But i'll explain why but the thing here the options are 10 cents, you know So if you're paying 10 cents, you know, let's say we want past, you know a month past to cover the expiration and you're paying $20 for An option that covers, you know, 100 shares cost 200 bucks Or at this case 140 in this case It's probably better to just buy the shares than to spend 10 percent of the value, you know, you're gonna end up spending 20 bucks on for a 200 asset. That's that's 10 percent. So You're gonna pay 10 that could expire when in this case if you bought 100 shares and it goes to zero Your max risk is a hundred forty two dollars and the fact is you get to hold it for a long time So in this case, I would want to do that Now does that mean put in five ten thousand dollars? Probably not because now you're taking a lot more risk But with 100 to 200 maybe 300 400 shares Doesn't seem like too bad of an idea here. So that's where you know, and i'll show you guys The idea behind it is Understanding, you know When to go with options when to go with shares and especially when you're playing biotechs, they're risky So you want to be careful over paying a premium? But at the same time you don't want to be a bag holder, you know, potentially, you know Because if they don't go right you're losing 50 percent of your money. So That's the one thing to to spot, you know how I pretty much found aktx Uh, you know this thing went up 50 60 percent in a couple days You know, I bought it on I bought it over here. So I was actually late to the party But even then it still shot up and you know, why because what happened is they got something uh called a A fast track approval. So what happened their drug approval's coming up on the 21st And i'm gonna show you guys how to find it or the 24th for their phase two And you know i'll show you guys even the process of it But before that they're working on another drug and the fda gave them approval to say hey You're working, you know when when medical companies work on drugs that are they call them orphan drugs drugs that are not really Widely made the diseases are really small but really affect people the fda gives you fast track approval. So Meaning they speed it up and give you kind of a coupon It's a reward and and that's what happened with aktx on this day And that's what shot the stock up and then Not only did they get the fast track approval a lot of people were buying in and you know Then they started announcing when they were going to start presenting their phase two results, which were coming up So it was kind of a one-two punch They got the fast track and they got you know, their face to coming up and here's the thing This stock was trading at six bucks. Uh, their market cap is 22.3 billion and isn't it funny, you know, it's pretty big but you know bringing it down here When they were at six dollars a share they were at six billion So they were still a pretty a very large company and you know, that's one reason why I like them But and it's crazy to see, you know to see how much they move, you know Think about they were moving three fifteen percent today with a billion flow kind of insane. Um, but What people were you know, the fact is even at six billion dollars, they were they're worth a lot They have assets the company makes some money already, but the minute they got that fast track approval That literally is an asset, you know a fast track approval you could sell it to other companies I think between like 20 bucks 20 million, excuse me and 150 million You could literally sell that coupon to another pharmaceutical. So that's assets right there. But so that's that. Um, As far as that goes, I wouldn't encourage you guys to play this Uh, you know again because it's high but now if you want to find these, you know Just like I kind of even found that plx one Here's the website I go to uh, you could go to it's biofarmcatalyst.com This kind of simplifies it I will tell you now they don't have everything Uh, and what I like to do is I double check biofarm catalyst with the filings So because everything you could read in the filings it's here if you read the news and stay up to date You know, all that information is in the filings. However, this site is wonderful I'm making simple and you just go here catalyst calendars. There's fda and padufa You want to go to fda the padufa is like the final stage of a drug getting approved But it pretty much gives you the stock and what stage they're in so we go down here's aktx boom Coverson this is the that's what they call the drug or the study and it's saying what it's pretty much going to help And here's its phase two. That's what they're going and interim data presented april 24th So that's coming up soon You know if you wanted to simplify this and try to make plays make day trades off this You simply just look for the date and make your bet now The next part i'm going to tell you guys is how to go about the filings And where to look and understand it because when you read these filings, you know, quite frankly You don't need to be a rocket scientist or a health professional to get these it's really not that difficult You know, so i'll even show you guys because what I saw, uh, you know, I already know about Ah about aktx. So i'll show you one. I haven't even played yet. I might not play I don't know but here's plx the one we just saw with options. It's cheap price But so they're working on their air d dna's prx 110. So that's what the drug drug is. It's for cystic fibrosis. Um, So that's not fibromyalgia. I forgot cystic fibrosis. I don't even know so it's saying 414, you know Look at that's in a couple days and sometimes this these are just estimates so it could happen a little bit before or after But it says phase two interim data released in january full data due first half of april 2017 so April 14th is noted as an estimated date Uh, and that's due to guidance of first half in april so they don't have a specific date And that's the thing that you guys got to realize here These are estimates and why i'm showing you guys this video and why i'm making this video now is to tell you guys These are important months for pharmaceuticals. There is a pharmaceutical cycle, uh, especially with some of these companies and you know Kind of what I look for in them but you are coming close now to an area where a lot of things their first quarter of the new year a lot of Pharmaceuticals are reporting and we even saw that within the last couple weeks and even month Uh throughout march is usually a popular day They're going to kind of start fizzling out here in may maybe or april and then maybe early may and then come around June july you'll see that burst up again and then fast forward back to january february or mainly february march of 2018 you're going to see them start to boost again And it's just all about understanding their trials and all their companies But why i'm saying this is there there could be opportunities but again The risk is going to be in paying too high of premiums and the fact that it's just a coin toss and you could really get smoked on these so Let's go. Here's aktx, but let's look at plx, you know, we saw it Let me show you guys how to go about the filing. It's very simple. I'll show you just some quick tools to it Um, you go to nasdaq.com scc filings And you want to pull up their 10k, which is their annual statement, uh, you'd even get the same in the 10q But that's the quarterly but the 10k puts it all and you know Really what you want to scan for right away is simply to the overview Uh, so there's here's business and overview. It pretty much explains but as you see here, they give you nice Well, they give you nice little documents and pictures. So we're looking for prx 110 So what we see here is that they have three drugs So now sometimes when i'm analyzing this that's good and bad Um, because if i'm looking for because sometimes even though they have good phase two phase three If they have multiple drug candidates and one, you know Let's say prx 110 is one of three drugs, but that has the smallest market, you know They're they're mainly going to make all their money from prx 102 It might not you're not going to see the stock go up 50 100 couple hundred percent off of uh, fda approval But now let's say it was one or two drugs and then that's why you want to read these filings that's how you guys learn to zone in on what's good and what's bad with these is by simply Reading the the market that they're affecting how much money can they potentially make? How many patients will they go and you want to see really? What is it? In terms of the health of their company What role does that does that drug play because you got to think when people invest in these companies from the get-go, you know They're looking For that this is what they're investing in so if they only have three drugs and they're saying this is our main drug here or other two If that main drug does good or if one of the main drugs fails, well, you know, that's all she wrote So it explains it and you know, really what I would like to do here I'm either gonna I just do control f uh, and you know, I would read through this. So let's go to prx 110 So here's the cystic fibrosis Uh, it's our propriety plant cell recumbent human dextra nucleus. I don't know what that means It's under development for cystic fibrosis. I would google that to be administered through an inhalation. So it's something you inhale uh, it's a Actin inhibitation resistance is designed to improve lung function. Okay, so I think this is like Um five not yeah cystic fibrosis. Okay. Those are the people who have this stuff with the you know, they need the air stuff They have trouble and they get like a lot of mucus overproducing mucus in their lungs. I believe something like that Recurring in functions is demonstrated improved disease parameters in animal models and humans sputum testing when compared to currently invested we commence phase two In january, we announced positive results from the phase two for the first 13 cf patients enrolled in the study Upon review of the final results of the trial. We will consider different collaboration alternate Alternate as part of further development. So that's just a little Broad explanation one thing I will say now it has 13 patients so I don't know if this is a Orphan drug thing they're going for but the simple fact of the matter when i'm looking through my you know The farmers to pick I would be this is a sign that even though they do good They may or they may not get approval simply because this sample size of what they're testing their drug on is small now, let's say there's not a lot of people who have the disease it could make sense, but That's where you guys got to start looking into it. So You know, that's what you do in there If you don't want to go through all this really this is what I do simply I look for the year or the quarter So I will either look up april. There's 10 results ctrl f april 2005 april 2010 10 10 12 So it really looks like nothing here is in for april pretty much. Okay. So now I would do 2017 so march, so they registered oh wow march 1st, they Okay. No, that's just saying how many shares they have because this is when their filing was Um, let's see So we received a letter from file crews regarding uh, brazilian moh to purchase. So yeah, they sold something and okay So they're making money, which is good. Uh They they got an order for 24 million. This one's not as important again because we're looking for The drug approval, so I think we already read this um Yeah Let's see here. Uh, perfect nope, this is a different study because it's saying bridge not the Yeah, this is under prx 102 Okay Okay, so here's a good one. And now here's I think yes cf cystic fibrosis, right? So it's saying in january. Um, Yeah, and this is alder alder phase alpha So this is related to what we're looking for in january 7 We announced positive interim results for phase 2 clinical trial for the first 13 cf patients at that time 15 had been enrolled and were expected to complete the study the initial primary efficacy results show the aldernase alpha improves lung function Demonstrated by a mean absolute increase in the percent predicted forced expired expiratory volume in one second Uh 4.1. Yeah. Yeah. Yeah. Yeah. Let's see I'm, just gonna scan through this Okay. No, so this is from okay. We want this one. This is 110. I believe right? Yeah So this is interesting. So right here Again, so they do all cystic fibrosis, but this is what I want to look for right here. It says money But It's saying yeah saying the thick music that accumulates in the lung for cystic fibrosis patients Currently pulmozyne is the only dna is commercially available with annual sales of approximately 685 million in 2016. So that's great so Besides the sample being small now, I guess now this is where I give a point for positive There's the competing drug is making 671 million dollars. That's a lot of money Um, you know, I would want to even see what's plx's market cap to to get a comparison 176 million dollars is their market cap. So this could skyrocket them. Actually, that's a very good sign Uh, again, I would look more into revenue and stuff like that. But in vitro studies with prx Uh demonstrated enzyme kinetics significantly reduced sensitivity to ambition uh And improved ex vivo efficacy when compared to pulmozyne. So wow Simply put so now we lead here. So it looks like you know, I can't read these charts too Well, but comparing this to the drug that makes 671 million a year They're shitting on it. So That that's a good sign, but i'll leave it at that to not get too too short But really the whole idea here. I don't want to go too long I mean and I want to make sure you guys have questions i'll make a part two on this Um, but really what you want to do is go through these filings Go read this first couple pages, you know scan for the date simply of when the drugs are coming out or when it's expected to Double check here if you ever see a biostat tech tech stock running up That's what I saw with aktx go look into it. Go check on biofarm catalyst Go look through all these companies open up their filings and just familiarize yourself with what they do Uh the study how big the sample size is but you really only need these first five ten pages and it explains everything You know their business overview is the section or just business. They have these, you know Documents or you know graphs and diagrams that you can see so it's very simple Uh, you know and really control f is your friend, you know You want to search for the dates and and stuff like that and that's pretty much the gist of it You know the next video if you guys want to know more about these I guess the next video i'll make is how to interpret a study and do that because now it's being able to You know, i've traded these so long. I kind of know, you know, my buddy have a family in medical So with the medical history, so I kind of know how these processes work but it's also just kind of understanding how These processes go about both financially and medically because at the end of the day Although we're playing it financially These are medical decisions that are that are giving us the results. So i'll leave you guys with that I really really hope you enjoyed this. Hopefully this helps you guys in some way Uh, please be safe and responsible with this information And make sure you guys subscribe and you know, let's see. Can we get I want I don't think i've got like, you know Unless it's a funny video. I haven't got like 200 likes. So let's please let's get this 200 likes Hopefully this helps you guys Stay school. Love y'all