Financials

Why invest in Financials 

The sector comprises of banks, insurance companies, investment funds etc. Financial sector is the backbone of any healthy economy and is a key driver in its growth. The banking sub sector sector performs well in low interest environment  when the lending activity is high.   Insurance companies on the other hand helps in mitigation of risk .  Most companies in financial sector are stable and dividend paying. It is a highly regulated sector.

Key indicators to consider before investing

  • GDP
  • Employment
  • Business Cycle

Top 5 ETF’s by Market Capitalization

Name of the Fund Ticker Symbol /Total AUM* Year of Inception Expense Ratio
 Financial Sector Select SPDR   XLF  12/16/1998 0.14%
 Vanguard Financials  VFH  01/26/2004  0.10%
SPDR KBW Bank   KBE  11/08/2005  0.35%
 SPDR KBW Regional Bank  KRE  06/19/2006  0.35%
 iShares Dow Jones US Financials    IYF  05/22/2000  0.44%

 

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