One financial stock that's already benefiting from the Goldman suit is Royal Bank of Scotland Group (RBS), the UK-based banking giant that lost $800 million by betting on the wrong side of subprime mortgages through Goldman's infamous Abacus CDO. RBS management has already reported to the media that it's investigating whether or not it has any legal grounds against Goldman for its losses; that news sent shares up around 15% since Friday.
But investors should be careful about betting on RBS for the hope of a nearly billion-dollar legal win. Goldman's allowing the SEC's investigation to reach the courtroom (and not settling when it had the chance) shows that management is confident in its defense against liability suits. It's more likely that shares will take a knock when further details of the lawsuit come out.
For a more in-depth look at stocks that could be affected by the Goldman Sachs fraud lawsuit, check out the dedicated portfolio on Stockpickr.
-- Written by Jonas Elmerraji in Baltimore.
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