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Anyone else like Financials?


bbarberayr
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I've got about 50% of my portfolio in financials spread across life insurers, European financials and regional banks and they continue to kill it today and are amount the best performers of the market.

 

Regional Banks up 20% this month, XLF up 10%, pretty much all of the insurance companies I follow up 20%.

 

Big moves, but they are still among the cheapest stocks in the market and economic factors (less regulation, higher interest rates, improving economy) are moving to their benefit.

 

Yet, there seems to be little interest from people in buying these.  Perhaps most are value-oriented investors like me and have been holding for a while waiting for this, or maybe a lot of the faster traders have been burned chasing moves like this the last couple years, but sure seems like an easy place to get outperformance relative to an expensive general market the next couple of years.

 

Am I missing something here or anyone have ideas why things are acting this way?

 

Thanks

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Perhaps some anchor bias? Even though BAC might still be cheap, I'd have a hard time loading up @ 20 when I passed @ 12 back in February. But also; back then downside was protected by tangible equity - now I need to come up with assumptions. I loaded up on both WFC and IBKR and almost bottomticked 52 week lows prior to Trump, so I can't complain by the recent moves, but I have been trying to recall why I passed om BAC earlier this year. I think I was hoping for a screaming bargain, and in hindsight I was probably offered just that.

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(...)

 

Yet, there seems to be little interest from people in buying these.  Perhaps most are value-oriented investors like me and have been holding for a while waiting for this, or maybe a lot of the faster traders have been burned chasing moves like this the last couple years, but sure seems like an easy place to get outperformance relative to an expensive general market the next couple of years.

 

Am I missing something here or anyone have ideas why things are acting this way?

 

Thanks

 

I'm not sure what you mean by "there seems to be little interest from people in buying these"...

 

Based on the price movements and the volume of financial stocks since the election, it is clear that people are very interested in buying these.

 

I would agree with your statement if you had written it 2 weeks ago.

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I agree that prices are going up, so more buyers than sellers, but the broader market interest, from what I read,is in tech, commodities, energy, etc.  You would think there'd be more interest in financials.  So, for example, if I look at seekingalpha stock followers, you have 11,000 for tech company BRCD, but only 3,000 for pension manager/insurer VOYA, even though VOYA has a larger market cap.  Municipal bond insurer, AGO, ($5 billion mkt cap) had 1 analyst ask questions on their conference call this week.  Stocks like GS, which is up over 15% in a week, have no comments on this board since June.

 

Just seems that we should be seeing more talking about this and people getting on board with buying.

 

 

 

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