2024-05-24 12:37:27 ET
Summary
- SPDR S&P Bank ETF is a hold due to its heavy concentration in regional banks and the risk factors associated with them.
- KBE has underperformed broader financial sector funds such as VFH and XLF that have also seen lower volatility and lower expense ratios.
- Distinct risk factors remain for regional banks, including the risk of savings account outflows, reduced liquidity, reduced diversification, and interest rate sensitivity.
Investment Thesis
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KBE: Regional Banks At Risk For Continued Underperformance