A broker dealers-related ETF strengthened Wednesday after Goldman Sachs Group (NYSE: GS) revealed a better-than-expected profit gain under David Solomon’s first quarter of leadership as higher equities trading revenue and a surge in merger and acquisition activity offset a dip in bond trading.

The iShares US Broker-Dealers & Securities Exchanges ETF (NYSEArca: IAI) rose 3.6% and broke above its short-term trend line at the 50-day simple moving average. IAI includes exposure to investment banks, brokerages and stock exchanges that may have more to gain from trading activities.

Goldman Sachs saw a 56% jump in M&A fees, along with higher trading activity on its equity desk over a volatile quarter, despite the dip in bond trading, Reuters reports.

“It was a really treacherous quarter, and they navigated it fairly well,” Charles Lemonides of ValueWork LLC told the Wall Street Journal. “To have as difficult an environment as we saw and have a 12% return on equity shows you’re doing something right on the cost side.”

GS shares climbed 9.8% on the report. GS is the largest component holding under IAI, making 9.5% of the ETF’s portfolio.

Goldman Sachs targets $5 billion in additional annual revenue

According to Solomon’s plan, Goldman Sachs is targeting $5 billion in additional annual revenue by growing its consumer operation as it tries to entice institutional customers and convince existing clients to do more business with the bank.

Subscribe to our free daily newsletters!
Please enter your email address to subscribe to ETF Trends' newsletters featuring latest news and educational events.