FTAdviser.com

Advertising

The report found biotechnology showed a 3.7 per cent median loss, against 35.2 per cent for diversified resources, 33.9 per cent for gold and mining and 32.2 per cent for energy.

Irina Schoenberg, analyst at S&P, said in absolute terms, only one out of 67 S&P Fund Services-rated global sector funds was able to deliver positive returns in the third quarter: Pictet Funds' Luxembourg-domiciled $1.8bn (£1.2bn) Biotech fund, which gained 3.5 per cent.

Ms Schoenberg said: "This performance was mainly achieved by focusing on large-cap biotech stocks, which outperformed their small-cap counterparts."

Carmen Tang, co-manager of the fund, was optimistic about the biotech sector, citing its defensive character in a recessionary environment. She expected mergers and acquisitions activity to continue, suggesting a number of cash-rich companies could take advantage of the buyer’s market.

It has not been all plain sailing for the fund as it did experience some outflows in the third quarter and is now down in size from $2.3bn at the end of May to its current level.

However, according to S&P size reductions at some of the global sectors’ mega-funds over the same period were proportionately even greater. The BlackRock Global Funds World Mining fund fell from $17.1bn to $8.2bn, while the group's World Gold fund came down from $7.7bn to $5.4bn. At the same time the JPMorgan Natural Resources fund went down from €2bn (£1.7bn) to €523m.