Please ensure Javascript is enabled for purposes of website accessibility

Why Seelos Therapeutics Stock Is Jumping Today

By Keith Speights - Jun 1, 2021 at 1:22PM

You’re reading a free article with opinions that may differ from The Motley Fool’s Premium Investing Services. Become a Motley Fool member today to get instant access to our top analyst recommendations, in-depth research, investing resources, and more. Learn More

The company has been included in the first U.S. psychedelics-focused ETF.

What happened

Shares of Seelos Therapeutics (SEEL 4.52%) were jumping 11.4% higher as of 12:28 p.m. EDT on Tuesday. The gain came after the company announced that it has been included in the Defiance Next Gen Altered Experience ETF (PSY 0.27%). This is the first exchange-traded fund (ETF) focused on psychedelics-related stocks listed on a U.S. exchange.

So what

It's good news any time a small biotech stock is included in an ETF. As investors buy the ETF, the fund will buy more shares of the individual stocks that it holds. However, it's still too early to know for sure the full impact that the inclusion of Seelos in the Defiance Next Gen Altered Experience ETF will have. This ETF only began trading on May 28, 2021.

Letters made of hundred-dollar bills spelling ETF.

Image source: Getty Images.

Still, the launch of this new ETF should help further validate the emerging psychedelics industry. Seelos stands as one of the leaders in psychedelics, with two clinical-stage candidates in its pipeline targeting four indications.

This wasn't the first time that Seelos has been included in a psychedelics-focused ETF, though. In January, the company announced that it was one of 17 businesses included in the Horizons Psychedelic Stock Index ETF, which is traded on Canada's NEO exchange.

Now what

The main thing to watch with Seelos is its pipeline progress. Seelos recently announced positive results from part 1 of an open-label study evaluating SLS-002 (ketamine) in treating acute suicidal ideation and behavior in patients with major depressive disorder. It's also conducting clinical studies of SLS-005 (trehalose) in treating neurodegenerative disease amyotrophic lateral sclerosis (ALS), rare genetic disease Sanfilippo syndrome, and rare genetic muscle disorder oculopharyngeal muscular dystrophy (OPMD).

Keith Speights has no position in any of the stocks mentioned. The Motley Fool has no position in any of the stocks mentioned. The Motley Fool has a disclosure policy.

Invest Smarter with The Motley Fool

Join Over 1 Million Premium Members Receiving…

  • New Stock Picks Each Month
  • Detailed Analysis of Companies
  • Model Portfolios
  • Live Streaming During Market Hours
  • And Much More
Get Started Now

Stocks Mentioned

Seelos Therapeutics, Inc. Stock Quote
Seelos Therapeutics, Inc.
SEEL
$0.93 (4.52%) $0.04
ETF Series Solutions - Defiance Next Gen Altered Experience ETF Stock Quote
ETF Series Solutions - Defiance Next Gen Altered Experience ETF
PSY
$5.90 (0.27%) $0.02

*Average returns of all recommendations since inception. Cost basis and return based on previous market day close.

Related Articles

Motley Fool Returns

Motley Fool Stock Advisor

Market-beating stocks from our award-winning analyst team.

Stock Advisor Returns
373%
 
S&P 500 Returns
122%

Calculated by average return of all stock recommendations since inception of the Stock Advisor service in February of 2002. Returns as of 08/10/2022.

Discounted offers are only available to new members. Stock Advisor list price is $199 per year.

Premium Investing Services

Invest better with The Motley Fool. Get stock recommendations, portfolio guidance, and more from The Motley Fool's premium services.