Stockchase Opinions

David Burrows SPDR S&P Insurance ETF KIE-N BUY Sep 19, 2018

Today, everything in financials rallied, including the lifecos. Rising rates benefit them. Look at this to give you a basket of insurance companies. Today it broke new highs.

$32.480

Stock price when the opinion was issued

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BUY

Financials have been slower to recover, only gaining strength in September-October. Still have a long way to go. If you believe we had a generational low in long-term interest rates, and we're just entering a reflationary cycle, insurance companies benefit as assets go up in price. Higher rates are really good. Also interesting are KRE and KBE. Most interesting is IAI, making new highs. As a group, financials have underperformed since 2007, so they should now have a tailwind in this environment.

BUY
US financials ETF?

In his ETF long/short fund, financials are his second-biggest weighting. XLF includes BRK.B, Visa, JPM, a few regional banks, asset management companies, P&C companies. All are performing well right now. Only made a new high in the last year, start of a new, longer-term bull market.

KIE also looks really good, the insurers. KCE includes asset managers and investment banks, also good.

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HOLD

Look at the chart. One of the leading ETFs over the last couple of years, and that really chronicles the whole fortunes of the whole insurance industry.