I’ve been investing heavily (50% of portfolio in BAC and WFC) into the big financials since the FED took the rate to basically nothing. With recent announcement of keeping the current low rate for “extended” time, large banks will undoubted rip in profit as they continue to benefit from the spread. And despite the current run since the low in March, I think there’s much head way going upward. What the market did since March is the correction for the severely depressed bear market, but have not shown the earning potentials in growth. At least not until the banks stabilize the mortgage mess and when the financial statements start to reflect earnings, regardless when this would happen, but when it does and when the low rate disappears that’s when to rotate out of the big financials.
Amit Shah wrote a good article on big financials on seeking alpha.