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Three ETFs To Be Impacted by FinReg

Some ETFs that are likely to be influenced by the new law include:

  • Financial Select Sector SPDR (XLF), which boasts JPMorgan Chase, Bank of America and Wells Fargo as its top holdings.
  • iShares Dow Jones US Financial Services (IYG), which includes Goldman Sachs and Citigroup in its top holdings.
  • Vanguard Financials ETF (VFH), which gives ample exposure to some of the aforementioned firms as well as Travelers (TRV) and Aflac (AFL), which are expected to be impacted by the newly constructed Federal Insurance Office to monitor the insurance industry and give it 2 cents on ways to modernize insurance regulation.

When investing in these ETFs, it is important to consider the inherent risks that are involved. To help mitigate these risks, the use of an exit strategy which identifies specific price points at which downward price pressure is likely to be seen is important. Such a strategy can be found at SmartStops.net.

Written by Kevin Grewal in Houston.

Grewal has no positions in the securities mentioned.

Kevin Grewal serves as the editorial director and research analyst at The ETF Institute, which is the only independent organization providing financial professionals with certification, education, and training pertaining to exchange-traded funds (ETFs). Additionally, he serves as the editorial director at SmartStops.net where he focuses on mitigating risks and implementing exit strategies to preserve equity. Prior to this, Grewal was an analyst at a small hedge fund where he constructed portfolios dealing with stock lending, exchange-traded funds, arbitrage mechanisms and alternative investments. He is an expert at dealing with ETFs and holds a bachelor's degree from the University of California along with a MBA from the California State University, Fullerton.
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