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4 Financial Stocks for Volatile Markets

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3. GFI Group (GFIG - Get Report)

Goldman upgraded GFIG to "buy" from "neutral," arguing it has been one of the cast-aways of a financial subsector it refers to as "the market structure group" for the past three years due to a decline in credit default swap volumes, leading to shrinking margins.

However, Goldman's analysts point to GFIG's 5% dividend yield and what they call "two very attractive data assets" in Trayport and Fenics, as well as a net cash level of $62 million.

They estimate the core brokerage business is valued at just 4 times earnings.

They also believe there is a 10%-20% GFIG becomes "involved in an M&A transaction," as a result of its valuable over-the-counter trading and data platforms. Their 12-month price target of $5 implies 19% upside from Wednesday's closing price of $4.10, though the upgrade appeared to have a big effect as GFIG shares were higher by more than 10% in early trading Thursday.

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SYM TRADE IT LAST %CHG
XLF $24.31 0.12%
GFIG $5.82 0.00%
ICE $223.18 -0.09%
KCG $13.05 -0.31%
NDAQ $48.25 -0.66%

Markets

DOW 18,120.01 +39.87 0.22%
S&P 500 2,119.90 +2.21 0.10%
NASDAQ 5,095.0550 +2.97 0.06%

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