The market is rotating out of banks and into AI/Tech, driving bank valuations and investor positioning to extreme historical lows relative to broader indices.
Key Takeaways
- 1.Financial institutions are being aggressively sold to fund investments in AI and Technology, reaching extreme relative performance lows.
- 2.Investor positioning in banks has collapsed to the 8th percentile, indicating extreme bearish sentiment or underweighting.
- 3.Bank valuations have become significantly cheaper relative to utilities, reaching levels not seen since 2021.
Table of Contents
- XLF vs SPX
- XLF vs QQQ
- Positioning
- More on positioning
- EPS estimates
- Cheaper
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Authors
Author(s)
Securities
XLFSPXQQQNVDA
Themes
AI Trade CrowdingMean Reversion / Value Opportunity
Regions
North AmericaUnited States