Financial stocks have been hit, but these shares could be ready to rebound


Nikada | E+ | Getty Images

Losses in the S&P Financial sector extended into trading on Wednesday. After soaring post-election, financial stocks have since stalled, up just 1.7 percent for the year.

The exchange-traded fund that tracks financial stocks, the Financial Select Sector Fund (XLF), has dropped more than 5 percent in the past week. Using Hedge Fund analytics tool Kensho, CNBC ran a screen to see which financial companies tended to rebound after a move of this magnitude, in the following week.

The XLF has fallen by at least 5 percent in a five-trading-day period on 30 other occasions since 2010. A week later, the ETF trades positively 63 percent of the time, with an average gain of 1.3 percent. Compare that with the S&P 500, which trades higher 77 percent of the time in that period, returning an average of 1.4 percent.

Looking at the components of the components of the XLF, some potential winners emerge. Wells Fargo, Progressive and Moody's were the most consistently positive, trading higher 77 percent of the time, returning average returns of 2 percent, 1.9 percent and 2 percent respectively.

Affiliated Managers Group had the highest average return up 2.2 percent, while trading positively 67 percent of the time.

Goldman Sachs landed on the bottom of the list in both categories, notching the lowest average return of just 0.02 percent while trading negatively 60 percent of the time.

Correction: The XLF trades positively 63 percent of the time a week after it has fallen by at least 5 percent in a five-day trading period since 2010. An earlier version misstated the percentage.

Disclosure: NBCUniversal, parent of CNBC, is a minority investor in Kensho.