There is speculation that the collapse of the Silicon Valley Bank could expose problems lurking in ETFs tied to specific sectors.
Astoria Portfolio Advisors CIO John Davi has financials at the top of his list.
“You have to be aware of your risk,” Davi, who is in charge AXS Astoria Inflation Sensitive ETF, told CNBC’s “ETF Edge” this week. The fund is an ETF.com 2023 “ETF of the Year” finalist.
Davi claims the Financial Select Sector SPDR ETF (XLF) could be one of the biggest short-term laggards. It tracks the S&P 500 financial index.
His firm sold the ETF’s holdings in regional banks this week and bought larger capitalization banks, according to Davi. He sees larger institutions as a more stable, multi-year investment.
The XLF ended the week more than 3% lower. It is down almost 8% since the collapse of the SVB on March 10.