MOST READ: How to Play Crumbling Financials

Financial stocks lately are taking a beating as the mortgage crisis persists, tempting many investors to attempt to call a bottom for the real estate market and for banks.

Do so at your own peril.

A brutal week for financial stocks last week continued Monday, as Goldman Sachs cut its rating for the financial services industry to underweight from neutral and said that it was "clearly wrong" in upgrading the sector in May. That came on top of Merrill Lynch's report on Friday, which lowered earnings estimates and price targets for the largest regional banks. Merrill lowered price estimates for 12 large banks and predicted dividend cuts for four. ...