• 1,238 days Will The ECB Continue To Hike Rates?
  • 1,238 days Forbes: Aramco Remains Largest Company In The Middle East
  • 1,240 days Caltech Scientists Succesfully Beam Back Solar Power From Space
  • 1,640 days Could Crypto Overtake Traditional Investment?
  • 1,645 days Americans Still Quitting Jobs At Record Pace
  • 1,647 days FinTech Startups Tapping VC Money for ‘Immigrant Banking’
  • 1,650 days Is The Dollar Too Strong?
  • 1,650 days Big Tech Disappoints Investors on Earnings Calls
  • 1,651 days Fear And Celebration On Twitter as Musk Takes The Reins
  • 1,653 days China Is Quietly Trying To Distance Itself From Russia
  • 1,653 days Tech and Internet Giants’ Earnings In Focus After Netflix’s Stinker
  • 1,657 days Crypto Investors Won Big In 2021
  • 1,657 days The ‘Metaverse’ Economy Could be Worth $13 Trillion By 2030
  • 1,658 days Food Prices Are Skyrocketing As Putin’s War Persists
  • 1,660 days Pentagon Resignations Illustrate Our ‘Commercial’ Defense Dilemma
  • 1,661 days US Banks Shrug off Nearly $15 Billion In Russian Write-Offs
  • 1,664 days Cannabis Stocks in Holding Pattern Despite Positive Momentum
  • 1,665 days Is Musk A Bastion Of Free Speech Or Will His Absolutist Stance Backfire?
  • 1,665 days Two ETFs That Could Hedge Against Extreme Market Volatility
  • 1,667 days Are NFTs About To Take Over Gaming?
  1. Home
  2. Markets
  3. Other

Financial Hedge

As David Tepper pontificates why he didn't clear the deck of all his financial holdings - consider this contrarian thought.

Is buying the banks here at the very least a hedge?

You will notice that during the early bear market days of the past decade the banks actually outperformed the swooning SPX by a wide margin. This was in part due to their complicity in the housing bubble. It remains to be seen where their business model will take them today, considering the housing market is still bleeding.

However, we know that corporate America is flush with capital and will eventually turn to the banks for distribution. And yes, it will all be quite eerily similar to the easy money days of the housing bubble. But instead of your 24 year old nephew Jimmy buying an apartment building in Newark - it will be Groupon buying GE.

Food for thought.

Price Structure: Banks:SPX-Banks-SPX
Larger Image

 


(Positions in UUP, & ZSL)

 

Back to homepage

Leave a comment

Leave a comment