Opinions John O'Connell, CFA
Financial Select Sector SPDR FundXLFCOMMENTJul 13, 2015
John O'Connell, CFAStock price when the opinion was issued
As of Jun 08, 2026. Market Open.
You might be interested:
Still likes it. Over 3 years returned ~15% a year. Stalled a bit last year. Largest name in here is BRK.B, so a bit of a drag, as were MA and V.
US financials should be a big beneficiary of the rotation away from US mega-cap. Trades at discount to market.
Stan WongHas been a good medium-term holding. Financials in Canada are fairly, if not over-, priced. So an ETF with Canadian exposure probably has less upside. Doesn't see drivers to move Canadian banks and insurance companies higher right now. Probably more value on the US side. A bit of yield for income, but returns won't be as high as last year.
There is also a wall of money in the huge amount of M&A activity along with de-regulation in the US. There is appreciation for banks recently and the sector is reasonably priced at 16X compared to the market at 20X with a similar growth ratio. Canadian banks are improving too.
Greg Newman
US financials have been one of the better places to be so far this year. Went down with the whole tariff thing in April, but rebounded nicely. Financials should be one of the top places to be by the end of this year. He likes it on deregulation and tax decrease themes. Starting to see technical signs that the sector is starting to make moves to be one of the leaders again. MER is only 8 bps.
Stan WongLikes the financial sector in the US. In his opinion, it's one of the top sectors on a go-forward basis. 200-week MA has started to turn upwards, with 200-day trending higher as well. Looking beyond tariffs to deregulation and tax cuts, those moves will benefit some of the names in this ETF. MER is only 8 bps.
Great way to get exposure to all the major bank names as well as BRK.B.
Diversified exposure to US banks, investment firms, asset managers, and insurance. Economic activity in the US is improving. Financials are poised to benefit from higher trading volumes and more robust capital market activity. New US administration is pro-business, and that will boost the sector via de-regulation, corporate tax cuts, and business-friendly policies. All that will drive M&A, increasing profitability and fees.
Top names include JPM, GS, Visa, BRK.B. All well-positioned to benefit from these trends. During Trump's first year in 2017, financial sector went up by 22%. Yield from Canadian banks is better, but US names will give you more capital growth. Yield is 1.4%.
Stan WongUp 30% in last 12 months. Diversified with 75 US financial names., such as BRK, JPM, Visa, MA, and BAC. US financials are underowned in Canada. Mainly large-cap value, with some growth names. The space should do well, as we're on track for a soft landing in the US. Lower interest rates are expected to stimulate economic activity and boost demand for financial products.
Deregulation and pro-business policies of Trump administration should benefit the sector. M&A activity will speed up as a consequence, which enhances fees for financial institutions.
Stan WongHe's very bullish the market and financials. His fund has 28% exposure in financials, including insurance, private equity and regional banks.
Joe Terranova
Some people argue that an interest rate increase is going to be bullish for American banks, because they should see steepness in the yield curve, which is positive for the banks. He is not all that certain. In this case you could actually see the yield curve flatten, which would be a major negative. The real driver of the banks is going to be increased loan demand growth and investment banking fees from M&A. The space is a good one to be in, but he thinks the market is vulnerable to a pullback here. He would prefer to own one good bank, such as Wells Fargo (WFC-N), over a basket of average investments.