The time for the financial sector exchange traded funds (ETFs) may be at hand. After a year of recuperating from the financial crisis, big banks may be healthy enough to resume the task of making big money.
Big banks and the financial sector ETFs may be the best performers in the few weeks to come, opines Jeffrey A. Miller for iStockAnalyst. Miller analyzed the sector by looking at Trends, Cycles and a bit of Anticipation, or what he calls the TCA-ETF system.
The recent dip in major bank stocks came after President Barack Obama announced increased bank regulations. Critics see this as an attack on the fundamental business model and Congressmen are in no real rush to push the changes. [How New Bank Tax Could Hurt the Industry.]
The most prominent bullish argument for banks is the yield curve slope, which allows banks to make profits on the rate spread. [Fed Hikes Rates.]
Lastly, don’t forget that the most beaten-down areas tend to do best in recoveries, since they have the most ground to make up.