Testing times

A DIY COVID-19 antibody test takes a lot out of our multi-asset portfolios fund manager Will McIntosh-Whyte. Cleaning up the mess, he’s reminded of why becoming an armchair expert is dangerous for investors.

Covid19 sample

Murder on the dance floor? Not in lockdown. Instead, last Friday night there was just blood on the bathroom floor.

Getting blood out of yourself with a lancet is not as straightforward as it seems. The first attempt on the little finger got us halfway there. The second little pinkie apparently didn’t go to the blood bank. And the third time lucky index finger promptly gushed all over the floor. Job done – eventually.

As you might have gathered, the COVID antibody test is not the easiest DIY medical procedure. Although I’m sure most people wouldn’t make such a pig’s ear of it. As I sent back my overpriced test kit, I found myself wondering why I had bothered. The warnings littered through the process of obtaining one of these kits highlight that the presence of antibodies doesn’t guarantee immunity anyway. Even if it did, there is no way of knowing how long the antibodies last. And it also doesn’t preclude you from being a carrier. So what was the point of turning my bathroom into a scene from Dexter? 

The amount of blood required for the test was surprising, and highlighted why Elizabeth Holmes (of Theranos infamy) dreamt of using a single drop of blood to test for a wide range of diseases and conditions. Originally feted by investors, her company’s sensational claims turned out to be pipedreams that are now evidence in a fraud trial. Theranos had no such thing, and having tried to gather enough blood to test for just one blood marker, I now have a visceral understanding of just how hard it must be to create what Theranos strived for. If you haven’t already, check out John Carreyrou’s Bad Blood for an exceptional read and sobering reminder for investors to remain sceptical in the face of a star-studded board. 

Just the other week markets shot up on hopes that Boston-area biotech Moderna had a viable vaccine. The CEO appeared on CNBC talking up its prospects – and the company share price, which traded around 30% higher on the day … The company subsequently raised $500 million of equity that very evening (and company executives sold tens of millions of dollars of shares during the day). More details have since emerged as to the efficacy of those trials and, while promising, the company could only release crucial antibody test findings for eight patients out of the 45 that took part in the trials. Markets more broadly have also taken heart at successful news from a range of companies across the globe that are racing to find a vaccine. I am an optimist at heart, and I am encouraged by the global effort to find a solution to this awful pandemic. Yet I’m also a realist and a sceptic when it comes to information. That makes me wary that historically vaccines have taken a very, very long time to develop. Added to that, not one has so far been developed for a coronavirus in humans.

Of course, modern technology should certainly help reduce this timeline – it took a matter of weeks to map the genome of this virus, whereas they didn’t even have a microscope powerful enough to see the Spanish Flu. And perhaps the sheer volume of effort and financing being thrown at this might help expedite a solution. The range of different techniques being applied to develop a vaccine is remarkable in itself. There are, I’m sure, plenty of hurdles to overcome on the path to a vaccine, not least the virus disappearing from our shores too quickly according to those working on Oxford University’s solution! They are now rolling out tests in Brazil. There are perhaps more obstacles down the line – even persuading the public to get vaccinated at all, given the surprising strength of the anti-vaxxer movement in recent times, as well as potential public concern over the long-term effects of any vaccine rushed out in a matter of months.

Whenever investors are confronted with an unfamiliar risk (or opportunity), there is a rush to get up to speed. Investors turned wannabe nuclear scientists post-Fukushima. There were a remarkable number of cryptocurrency ‘experts’ rolled out as Bitcoin soared back in 2017/18; half my football team became part-time cryptocurrency traders during that craze. Today, I am wary of becoming an armchair epidemiologist. You can trick yourself into believing you’re an expert because you know the lingo, something that is very dangerous for an investor. Instead, I prefer to get updates from experts in the field who have no obvious vested interests. So far I have yet to find one who is particularly excited about any of the potential vaccines under development. Yet many do seem confident it can be achieved.

Picking the winner in vaccines is, of course, a lottery. Rather than try we are sticking to investing in trusted quality healthcare companies that fit our longer-term themes of people spending more on healthcare as the population gets older. It helps that several of them also happen to be big beneficiaries of the increased testing environment (both those names with approved COVID-19 tests in the UK are in our Multi-Asset Portfolio Funds).

Of course if we can find a trusted vaccine soon – and I remain hopeful we can – it would help ensure no more casualties, end this needless suffering and enable a return to normality. We can also move on and get back to talking about something else. Brexit anyone?!


Important legal information

This area of the site is for professional advisers

Please read this page before proceeding, it explains certain legal and regulatory restrictions applicable to the distribution of this information. It is your responsibility to inform yourselves of and to observe all applicable laws and regulations of the relevant jurisdiction.

This section of the website is directed only at investment advisers and other financial intermediaries who are authorised and regulated by the Financial Conduct Authority (FCA).

The information provided in this site is directed at UK investment advisers only and must not be circulated to private clients or to the general public. It does not constitute an offer to sell, or solicit an offer to purchase any investments by anyone in any jurisdiction in which such offer or solicitation is not authorised or in which a member of the Rathbone Group is not authorised to do so.

I confirm that I am an investment intermediary authorised and regulated by the Financial Conduct Authority. I have read and understood the legal information and risk warnings below:

Important Information (Terms and Conditions)

The information contained on this site is believed to be accurate at the date of publication but no warranty of accuracy is given and the information is subject to change without notice. Any opinions or estimates included herein constitute a judgement as of the date of publication and are subject to change without notice. Furthermore, no responsibility is accepted for the accuracy of any information contained within sites provided by third parties that may have links to or from our pages.

Rathbone Investment Management Limited ("RIM") is authorised by the Prudential Regulation Authority and regulated by the Financial Conduct Authority and the Prudential Regulation Authority. Registered Office: Port of Liverpool Building, Pier Head, Liverpool L3 1NW. Registered in England No 01448919.

In accordance with regulations, all electronic communications and telephone calls between Rathbones and its clients are recorded and stored for a minimum period of six months.

The information provided in this site is directed at UK investors only. It does not constitute an offer to sell, or solicit an offer to purchase any investments by anyone in any jurisdiction in which such offer or solicitation is not authorised or in which a member of the Rathbone Group is not authorised to do so.

In particular, the information herein is not for distribution and does not constitute an offer to sell or the solicitation of any offer to buy any securities in France and the United States of America to or for the benefit of United States persons (being resident in the United States of America or partnerships or corporations organised under the laws of the United States of America or any state, territory or possession thereof).

In order to comply with money laundering and other regulations, additional documentation for identification purposes may be required.

Rathbones shall have no liability for any data transmission errors such as data loss, damage or alteration of any kind including, but not limited to, any direct, indirect or consequential damage arising out of the use of services provided or referred to in this website.

Past performance should not be seen as an indication of future performance.

The value of investments and the income from them can fall as well as rise and you may not get back the amount originally invested, particularly if your client does not continue with the investment over the longer term.

Changes in the rate of exchange between currencies may cause the value of an investment to go up or down.

Interest rate fluctuations are likely to affect the capital value of investments within bond funds. When long term interest rates rise the capital value of units is likely to fall and vice versa. The effect will be more apparent on funds that invest significantly in long dated securities. The value of capital and income will fluctuate as interest rates and credit ratings of the issuing companies change.

Tax levels and reliefs are those currently applicable and may change and the value of any tax advantage will depend on individual circumstances.

Investing in emerging markets or small companies may be potentially volatile, as these investments are high risk.

The design, text and images are owned, except as expressly stated by members of the Rathbone Group. They may not be copied, transmitted, displayed, performed, distributed, licensed, altered, framed, stored or otherwise used in whole or in part or in any manner without the written consent of Rathbones except to the extent permitted and under the procedures specified in the copyright Designs and Patents Act 1988, as amended and then only with notices of Rathbones' rights.

Rate this page:
Average: 5 (4 votes)

Subscribe to the In the KNOW blog email