For investors seeking momentum, Invesco KBW Bank ETF KBWB is probably on the radar. The fund just hit a 52-week high and rose 58.9% from its 52-week low price of $51.13/share.
But, are more gains in store for this ETF? Let’s take a quick look at the fund and the near-term outlook to get a better idea of where it might head:
KBWB in Focus
The underlying KBW Nasdaq Bank index is a modified-market capitalization-weighted index that seeks to reflect the performance of companies that do business as banks or thrifts that are publicly-traded in the United States. The product charges 35 bps in annual fees (See all Financials ETFs here).
Why the Move?
The Fed is likely to cut rates in the near term, which may boost the risk-on trade sentiments and push up long-term rates. Since banks borrow money at short-term rates and lend capital at long-term rates, the steepening of the yield curve is always a plus for bank ETFs.
More Gains Ahead?
Currently, KBWB has a Zacks ETF Rank #2 (Buy) with a High risk outlook. However, it might continue its strong performance in the near term, with a positive weighted alpha of 22.71 (as per Barchart.com), which gives cues of a further rally.
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Invesco KBW Bank ETF (KBWB): ETF Research ReportsThis article originally published on Zacks Investment Research (zacks.com).
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