Asset allocation model
The banking sector – or, more broadly, the financial sector – is a vital piece of a healthy economy and subsequently an important barometer of overall economic health. With a total market capitalization in the trillions, financial stocks are portfolio staples in just about any diversified portfolio. Banking institutions make the economy go round, with loans, credit, mortgage, investments, and risk-taking. The banking sector can be especially susceptible to cyclical economic forces and interest rates. JPMorgan Chase, Bank of America, and Wells Fargo are among the industry leaders that survived the most recent financial crisis, but there are also new, smaller players to the scene are raising confidence in the banking sector’s long-term prospects. Companies across the sector have embraced technological advancements to offer new tools and platforms to their customers at lower cost, giving the banking sector a healthy future outlook with ample growth potential.