For investors seeking momentum, iShares U.S. Financials ETF (IYF - Free Report) is probably on radar. The fund just hit a 52-week high and is up more than 60% from its 52-week low price of $54.42/share.
But are more gains in store for this ETF? Let’s take a quick look at the fund and the near-term outlook on it to get a better idea on where it might be headed:
IYF in Focus
This ETF targets the broad financial sector. It seeks to provide exposure to 142 U.S. banks, insurers, and credit card companies. It charges 41 basis points in annual fees (see: all the Financials ETFs here).
Why the Move?
The financial segment of the broad U.S. stock market has been an area to watch given the rise in yields. The 10-year Treasury yield is hovering around 1.57% amid fears that supply constraints could disrupt the holiday shopping season. Additionally, the Federal Reserve will likely begin to taper its massive bond purchases as soon as this year and is ready to raise rates in 2022. The financial sector is the biggest beneficiary of this trend. This is because the steepening yield curve would bolster profits for banks, insurance companies and discount brokerage firms.
More Gains Ahead?
Currently, IYF has a Zacks ETF Rank #3 (Hold) with a Medium risk outlook. Therefore, it is hard to get a handle on its future returns one way or the other. However, many of the segments that make up this ETF have a strong Zacks Industry Rank. So, there is definitely some promise for those who want to ride this surging ETF a little further.
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For investors seeking momentum, iShares U.S. Financials ETF (IYF - Free Report) is probably on radar. The fund just hit a 52-week high and is up more than 60% from its 52-week low price of $54.42/share.
But are more gains in store for this ETF? Let’s take a quick look at the fund and the near-term outlook on it to get a better idea on where it might be headed:
IYF in Focus
This ETF targets the broad financial sector. It seeks to provide exposure to 142 U.S. banks, insurers, and credit card companies. It charges 41 basis points in annual fees (see: all the Financials ETFs here).
Why the Move?
The financial segment of the broad U.S. stock market has been an area to watch given the rise in yields. The 10-year Treasury yield is hovering around 1.57% amid fears that supply constraints could disrupt the holiday shopping season. Additionally, the Federal Reserve will likely begin to taper its massive bond purchases as soon as this year and is ready to raise rates in 2022. The financial sector is the biggest beneficiary of this trend. This is because the steepening yield curve would bolster profits for banks, insurance companies and discount brokerage firms.
More Gains Ahead?
Currently, IYF has a Zacks ETF Rank #3 (Hold) with a Medium risk outlook. Therefore, it is hard to get a handle on its future returns one way or the other. However, many of the segments that make up this ETF have a strong Zacks Industry Rank. So, there is definitely some promise for those who want to ride this surging ETF a little further.
Want key ETF info delivered straight to your inbox?
Zacks’ free Fund Newsletter will brief you on top news and analysis, as well as top-performing ETFs, each week.
Get it free >>
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