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Biotech Bull Is Back: 4 Keys To Play It

Since the biotechnology bubble burst in 2015, resulting in a 40% bear market, something has been building that I've been waiting several quarters for -- a resumption of the great, long-term bull market.

This week, the Nasdaq Biotechnology Index ETF [IBB] surmounted a closing level that takes back half of its losses. I think we have a lot more room to go, and maybe even new highs eventually.

But the rules are different this time in this second big wave of the bio bull. You can't simply ride the next hot tip or momentum play. Your research and stock selection must have certain discipline, or else you'll get burned.

Here I share 4 keys in my research process and why they are so important.

1) Investment Bank Research

I read dozens of research reports every week from Wall Street's top investment analysts. Now, we all know that these analysts are conflicted from time to time as one side of the company is providing advisory or capital/underwriting services for a fee while the "pure research" side is not supposed to be influenced by that business.

But for the most part, there are many good and un-conflicted analysts devoted to their research. Many are PhDs in the life sciences or even have medical degrees and they care about the quality of their analysis. Reading their reports every week gives me an edge on understanding the most complicated investing in the world.