How the Covid-19 vaccine relates to the stock market

If there is one term that has been heard, discussed and debated heavily in 2021 it is “vaccine.” The Covid-19 pandemic has put vaccines back in the spotlight and prompted heavy debate regarding one of the most important inventions in medical history. Such a hot topic, which is essentially relevant to the world’s entire population, is also a source of great investment opportunity.

Explore Vaccine Stocks

Your capital is at risk. 

CopyPortfolios is a portfolio management product, provided by eToro Europe Ltd., which is authorised and regulated by the Cyprus Securities and Exchange Commission. 

The vaccine market

It is not often that a manufacturer can truly say that its target market is “everyone” — but that is the case with vaccines. From their earliest days, vaccines have always been relevant to almost every member of the human race. Some are given during the first year of a baby’s life, others later in adulthood, and some, like the recently developed Covid-19 vaccine, are given as part of a worldwide effort to combat a pandemic.

In 2019, the global vaccine market was estimated at just under $50 billion and it is expected to more than double by 2027. 

Naturally, the research and development behind the creation of a vaccine is extensive and expensive. This is why, in today’s world, they are almost always developed by pharma giants. These multinational companies have the resources, infrastructure and facilities to see the entire process through. However, since human lives are at stake, these companies also have to adhere to strict limitations of health regulatory entities, such as the American Food and Drug Administration (FDA).

Moreover, since they are also publicly traded companies, pharma giants are also under the constant scrutiny of their shareholders. Therefore, vaccines are a massive undertaking, and while carrying a significant potential profit, they also involve tremendous risk. So how should investors look at this market?

Clinical trials: The Covid-19 pandemic

The history of vaccines can be traced back to the 1500s, with the earliest testimonies of preemptive treatments utilised in China and India. However, it was not until the late 1700s that the term “vaccine,” was coined, derived from the Latin word for cow, as the bovine version of smallpox was used to inoculate humans. Over the years, vaccines have been part of the global medical effort, preventing diseases such as measles and tuberculosis, and even completely eradicating some diseases such as polio and smallpox.  

Vaccines have been at the heart of many public debates in recent years, with so-called “anti-vaxxers” on one side and scientists and medical professionals on the other. However, the coronavirus pandemic has buoyed the discussion, and as new vaccines are being developed and rolled out, the importance of this medical tool has become all-the-more apparent. 

Covid-19 has impacted the lives of almost everyone on the planet in one way or another. Different governments have taken different approaches to manage the pandemic, ranging from mild restrictions to comprehensive lockdowns. 

It took just nine months for a vaccine to be developed and tested. After successful clinical trials, in late 2020, vaccines began to be approved. Pfizer and Moderna both received Emergency Use Authorization from the FDA and began shipping around the world. At present, the vaccines are still being administered in different countries and at different paces, but they will most likely hold the key to a return to normal life.

Investing in vaccine stocks

With so much growth potential and constant public debate, stocks from pharma companies that are developing vaccines are alluring to many investors. However, it is often difficult to sift through all of the companies and find the ones in which to invest. To present its users with exposure to this high-profile market segment, eToro has created the Vaccine-Med CopyPortfolio, which comprises stocks from pharma giants alongside pure players in the vaccine space. 

Explore Vaccine-Med

Your capital is at risk. 

CopyPortfolios is a portfolio management product, provided by eToro Europe Ltd., which is authorised and regulated by the Cyprus Securities and Exchange Commission. 

Data in this article was taken from this datasheet.

67% of retail investor accounts lose money when trading CFDs with this provider. You should consider whether you can afford to take the high risk of losing your money. 

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eToro is a multi-asset platform which offers both investing in stocks and cryptoassets, as well as trading CFDs. 

Please note that CFDs are complex instruments and come with a high risk of losing money rapidly due to leverage. 67% of retail investor accounts lose money when trading CFDs with this provider. You should consider whether you understand how CFDs work, and whether you can afford to take the high risk of losing your money. 

Past performance is not an indication of future results. Trading history presented is less than 5 complete years and may not suffice as basis for investment decision. 

Copy trading is a portfolio management service, provided by eToro (Europe) Ltd., which is authorised and regulated by the Cyprus Securities and Exchange Commission. 

Cryptoassets are volatile instruments which can fluctuate widely in a very short timeframe and therefore are not appropriate for all investors. Other than via CFDs, trading cryptoassets is unregulated and therefore is not supervised by any EU regulatory framework. 

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