U.S. Major Banking Stocks as of October 27, 2023

The plot shows the cumulative returns for banking stocks in 2023. The cumulative return is the total return of an investment over a period of time, including both capital gains and dividends. The plot shows the cumulative returns of seven banking stocks: BAC, BLK, C, GS, JPM, MS, and WFC.

As of October 28, 2023, the cumulative returns for banking stocks in 2023 have been negative, ranging from -5.19% for BAC to -23.16% for WFC. The average cumulative return for banking stocks in 2023 is -14.30%.

The plot shows that the cumulative returns for banking stocks have been volatile in 2023. The stocks experienced a sharp decline in January and February, followed by a modest recovery in March and April. However, the stocks have declined again since May.

The decline in banking stocks in 2023 is likely due to a number of factors, including rising interest rates, inflation, and the ongoing war in Ukraine. Rising interest rates make it more expensive for banks to borrow money, which can reduce their profits. Inflation is also putting pressure on bank profits, as it increases the cost of doing business. The war in Ukraine has also created uncertainty in the global economy, which has weighed on banking stocks.

Overall, the plot shows that the cumulative returns for banking stocks in 2023 have been negative. The stocks have been volatile and have experienced a number of headwinds.

The optimal portfolio allocation for banking stocks in the pie chart  is:

• JPM: 30.29% GS: 30.94% MS: 17.10% BLK: 1.06% BAC: 0.26% WFC: 0.35%

  This allocation is based on the following factors:

  • Historical performance: JPM and GS have been the two best-performing banking stocks in recent years. MS has also performed well, but to a lesser degree. BLK, BAC, and WFC have all underperformed the broader market.
  • Current valuation: JPM and GS are both trading at a premium to their historical valuation, while BLK, BAC, and WFC are all trading at a discount.
  • Overall risk profile: The banking sector is a cyclical sector, meaning that it is more sensitive to economic downturns. However, JPM and GS are both large, well-capitalized banks with strong track records. BLK is also a relatively low-risk stock, as it provides asset management services to a wide range of investors. BAC and WFC are both higher-risk stocks, as they have been impacted by recent scandals and regulatory issues.