2 Bank Stocks That Can Diversify a Tech-Heavy Portfolio

2026-01-06 06:20:00 ET

Tech and artificial intelligence stocks have delivered outperformance for investors in recent years. While the party may very well continue this year, the bar for tech and AI is certainly rising, as valuations increase and investors assess the returns likely to be generated from all this AI infrastructure spending.

No one knows the future, which is why investors may want to diversify their portfolios to mitigate risk. The banking sector is a good place to look for this diversification. Banks face a much easier regulatory regime under President Donald Trump's administration, and I would expect mergers and acquisitions (M&A) to accelerate over the next few years. Banking regulators may also lower regulatory capital requirements, allowing financial institutions to increase capital distributions to shareholders.

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