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The 6 Best Bank ETFs for American Bulls


Bank stocks and other financial equities are back in the spotlight again with the dawn of another earnings season. The financial sector helps kick off each quarter’s run of earnings reports, starting with majors such as JPMorgan Chase (JPM) and Citigroup (C), then followed by regional and community banks, as well as insurers and stock brokers.

If you are confident in the U.S. economy, bank ETFs are one of the most direct ways to express it. Robust economic activity means more business for banks – more mortgages, auto loans and business loans, as well as spending via personal credit.


The Federal Reserve has raised the fed funds rate, which in turn is helping lift interest rates, to help keep America’s economy from heating up too much. That is a good problem to have, especially if you hold bank stocks and funds. Rising rates, in turn, help banks by improving their net interest margin (the spread between what banks pay out in interest on deposits and what they earn in interest from mortgages and other loans). It’s no guarantee – higher rates can also dissuade consumers from taking out loans – but broadly, rising rates are viewed as bullish for banks and other financial stocks.

These seven bank ETFs provide varying ways to gain exposure to the financial sector. A healthy dose of bank stocks and other financial companies can deliver strong portfolio growth as the economy and interest rates expand.

SEE ALSO: Kiplinger's 20 Favorite ETFs for Investors

Data is as of Oct. 16, 2017. Click on ticker-symbol links in each slide for current share prices and more. Yields represent the trailing 12-month yield, which is a standard measure for equity funds.


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