Is Insmed Stock Paying You Enough For The Swings?

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Investors who hold Insmed (INSM) or are preparing to buy it likely have other investments tracking the broader market. Insmed, however, remains an unprofitable drugmaker with its newest lung medicine, BRINSUPRI, just past its first full year on sale. Every price swing impacts your entire portfolio, so the stock needs to pay you for those swings. Has owning Insmed made you more than the market, and enough more to cover the extra risk?

What Insmed Has Paid You Since 2021

The stock beat the market, but not by enough to compensate for the extra risk. In the five years since November 2, 2021, Insmed returned 30.0% a year, against 11.7% for the S&P 500. Investors endured significant price swings to capture those gains. Insmed’s annual volatility, a measure of how widely the stock moves over a year, was 74.3%, compared with 17.1% for the index.

Dividing each return by its volatility shows that every point of fluctuation generated 0.404 points of annual return for Insmed, against 0.684 for the S&P 500. Insmed delivered strong total gains, but the index provided a better return for each unit of risk carried.

How Big Have Insmed’s Swings Been This Past Year?

Over the past year, since November 7, 2025, Insmed posted a volatility of 62.9%, compared with 13.7% for the S&P 500. Most of those moves occurred independently of the broader market.

On the average day the S&P 500 rose by 0.661%, a $10,000 holding in Insmed lost $5.33. On the average day the index fell by 0.626%, the same holding lost $16.60, about a quarter of the index’s own fall. Over that year, Insmed’s shares lost 37%, while the S&P 500 returned 13.1%.

Insmed’s beta, a measure of how much the stock has tended to move with the index over the year, was 0.56. Even so, it did not track the index on a typical day: it fell on the average up day as well as on the average down day. Its daily moves lined up with the index’s only loosely, with a correlation of 0.12 on a scale where 1 means moving in perfect step. So Insmed adds little to the market risk you already carry, but it brings a lot of risk of its own.

Will Insmed’s Shares Keep Swinging This Hard?

Price swings of the past year’s size look set to stay. Insmed remains a company in transition: the business still loses money, a single new drug brings in most of its sales, and its next major medicine is unproven. BRINSUPRI generated $400.1 million of Insmed’s $524.4 million in revenue during the third quarter of 2026, while ARIKAYCE, its drug for MAC lung disease, accounted for the rest.

The operating loss has narrowed, to $81.8 million in fiscal Q3 2026 from $261 million a year earlier. On the October 29, 2026 call, management said it expects Insmed to become cash flow positive in 2027. Insmed is also paying for TPIP, an inhaled treatment with four late-stage studies started or planned, which management hopes could reach the market by the end of this decade. The FDA’s decision on a wider label for ARIKAYCE has a target date of January 28, 2027.

On the market’s average up day, Insmed lost money, and on the market’s average down day it gave up about a quarter of the index’s fall. Even so, Insmed lost 37% over the year while the index rose. Its big moves have mostly come apart from the market’s. If you already own other drug developers betting on a newly launched medicine, Insmed adds more of that same bet rather than spreading your risk.

Does This Mean You Should Act On INSM?

Our purpose is to inform you with unique data so you make the right investment decisions. That said, betting on a single stock is always risky, no matter which direction you choose.

There is a smarter approach. Since its inception, the Trefis High Quality (HQ) Portfolio has returned 105%, beating the benchmark that combines the three major indices – the S&P 500, S&P Mid-cap, and Russell 2000. And it did so without taking the concentrated risk that comes with do-it-yourself stock picking. If that is how you want to invest, the HQ Portfolio is the place to start.

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