From CNBC: 2025-02-08 11:00:01

The Trump administration is expected to benefit big banks and small cap stocks. Financial expert John Davi predicts deregulation will boost IPOs and M&As, especially for money center banks like Goldman Sachs and JPMorgan. The Invesco KBW Bank ETF is up almost 10% year-to-date and more than 49% over the past year.

While bank stocks are rallying, VettaFi’s Todd Rosenbluth believes small cap stocks will shine under Trump 2.0. He sees the group quickly adapting to reshoring and tariff threats. Rosenbluth recommends the T. Rowe Price Small-Mid Cap ETF and Neuberger Berman Small-Mid Cap ETF for investors looking to capitalize on this trend. The VictoryShares Small Cap Free Cash Flow ETF, with top holdings in biotech companies like Royalty Pharma and Oscar Health, is also highlighted.

Read more: Trump may boost for big banks due to deregulation, small caps