It was a nailbiter of a week. After sell-offs on Monday and Thursday, the and Dow Jones gave up year-to-date gains and closed its second week in the red for the first time since mid-November.
The financials sector, the darling of January, was swept up in the chaos. For the week, the XLF Financials ETF tumbled 6 percent, its second week in the red. Banks are now down 7 percent for the month, on track for their worst performance since June 2016.
This kind of damage presents an opportunity for investors to buy the dip in banks, says Mark Tepper, president of Strategic Wealth Partners, who is bullish on the sector. Here's why.
Tepper's favorite picks? J.P. Morgan, U.S. Bank and KeyCorp. Those three are at least 6 percent from their 52-week highs and have price-to-earnings ratios of between 12 to 13 times forward earnings, lower than the S&P 500's ratio of 16 times.
In short, keep calm amid the sell-off and buy the banking dip.