Yet the enthusiasm for financials may be limited only to a certain kind of investors, according to a Goldman Sachs research note from chief US equity strategist at Goldman Sachs
David Kostin’s team.
“Since the election, Financials have rallied by 25% led by a 33% surge in Banks, outpacing the 12% rise in the S&P 500,” the team noted.
Talking about exposure to financials, the team noted, “hedge funds have a low 11% net exposure to Financials while large-cap core and growth mutual funds overweight the sector.”
Highlighting a potential risk behind the rally in financials, Kostin’s team says, “a delay in tax cuts until 2018 will postpone the accretive earnings impact incorporated into many current year EPS forecasts.”
Get the latest Goldman Sachs stock price here.
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