Daily Stock Opinions and Ratings

Opinions

Larry Berman CFA, CMT, CTA BMO EQL WGT US BANK HDGD TO CAD IDX ETF ZUB-T DON'T BUY May 02, 2016

Or ZBK-T. If you want to be in the banks this is probably a good place to be. But he feels US banks will underperform for a long period of time. He does not like the sector.

Larry Berman CFA, CMT, CTA

Unknown

Unlock Rating

$18.980

Stock price when the opinion was issued

E.T.F.'s

It's the ideal tool to help you make quicker, more informed decisions for managing and tracking your investments.

Get Signals Create your Watchlist

You might be interested:

DON'T BUY

In general, US financials have had trouble tracking the S&P. He's underweight financials. Net interest margins, loan losses, economic uncertainty. Had moved up, but now back down.

COMMENT

Can get it in Canadian dollars and hedge it.

PARTIAL BUY

Basket of US retail and diversified banks. Don't have to worry about currency moves. He like the USD, so he'd prefer not hedged. Banks have gotten hit on recession worries. An opportunity here, though you might be a quarter or two early. Financials tend to perform well early in the cycle, though we're not there yet. Very cheap at 1.4x book value. Pick away at it. Best opportunities come when people are most unsettled. He's picking up some US financials right now. Yield is 2.3%.

BUY

If a long term investor, a good buy. Not a good product for day traders. Don't worry about liquidity. Always a buyer for product.

BUY

ZUB and ZBK

Both good, but ZBK gives US dollar exposure.

HOLD

A passive way to get exposure to US banks. More regionalized, not as much exposure to the large caps. Not as good a buy as it was a few months ago.

BUY

Would buy on the dip. Not expecting for this stock to breakout in the short term. Good for long term investors.

WEAK BUY

Despite being better diversified, US banking space can be more volatile than Canada's. Achieves more capital growth then an ETF with a covered call strategy. As well, consider some of the active options as offered, for example, from Hamilton.

PARTIAL BUY

ZUB vs. ZUE

US banks have been on fire, though valuations are higher. Interest rate margins are good. Do you expect banks to outperform? He suggests holding 25% in ZUB and 75% in the diversified S&P. It depends on how confident you are about the US banks.

WAIT

Largest in the category. ZBK is unhedged, but there's a hedged version as well (ZUB). He'd opt to start hedging risk away a bit more, given what seems a concerted effort to weaken the USD. Gives you diversification in the US banks, instead of Canadian banks, as it's a different market and different economy.

Banks are very sensitive to the economy, and we're in a recessionary period. He'd wait for positive market follow throughs before allocating capital. If you're in it for the long term, you could buy this on the pullback. Interestingly, US banks are down about 21%, whereas Canadian banks (as in ZEB) are down 9%.

Most Recent Experts

Rick Rule

Rule Investment Media

Stockchase Insights

5i Research

The Panic-Proof Portfolio (Stockchase Research)

Stockchase Premium