This is one of Goldman's best-performing stock portfolios this year for clients

Published Thu, Mar 31 202211:05 AM EDT

As the Federal Reserve plans to get aggressive with interest rate hikes, one special portfolio Goldman Sachs assembled for clients is shining above the rest so far this year. The "interest rate sensitive portfolio strategy" basket from Goldman Sachs beat the S & P 500 so far this year, and nearly all other portfolio strategies from the investment firm, according to a Wednesday note. A selection of 50 companies with the highest sensitivity to the 10-year U.S. Treasury yield collectively gained 3.3% this year, Goldman Sachs said. In comparison, the S & P 500 posted a 4.3% loss over the same time period. Those gains also made it the second-highest performing portfolio strategy in the U.S. for Goldman Sachs. Bottom line: As rates gain, these stocks typically post the biggest returns. The 10-year U.S. Treasury yield has shot higher to 2.32%, after ending last year at 1.51%, as the Fed embarks on its aggressive campaign to raise rates at every meeting this year to fight inflation. The investment bank measured each stock's beta to changes in the 10-year U.S. Treasury bond yield over the last two years, after comparing its sensitivity to the broader S & P 500 index. In the table, the rate sensitivity level is the stock's beta, and the rate sensitivity rank is relative to the S & P 500, the note said. Here are 10 stocks most sensitive to interest rates: Regional banks are unsurprising beneficiaries of a higher interest rate environment. The traditional banking businesses can make more money from higher interest rates on loans. Goldman Sachs listed Fifth Third Bancorp , which has a rate sensitivity level of 0.30 in relation to the U.S. 10-year Treasury, and has a rate sensitivity ranking in 98th percentile of the S & P 500. Other picks are more surprising. As interest rates rise with increasing economic activity, airlines and cruise line stocks can prove to be cyclical plays for investors. Cruise operator stock Carnival Corporation and airline stock United Airlines Holdings made the list. Computer chip stocks also made the list. Micron Technology has a rate sensitivity level of 0.07, and a rate sensitivity rank of 65%. NXP Semiconductors has a 0.08 rate sensitivity level, and a 67% rate sensitivity rank. Other stocks that made the list include ticket sales firm Live Nation Entertainment , insurance company Lincoln National , drugstore company CVS Health Corporation , materials company Corning , and payments firm Visa . —CNBC's Michael Bloom contributed to this report.

A United Airlines 737 Max 8

Leslie Josephs | CNBC

As the Federal Reserve plans to get aggressive with interest rate hikes, one special portfolio Goldman Sachs assembled for clients is shining above the rest so far this year.

More In Investing trends

This lithium battery stock could one day be worth $80 billion, according to Loop Capital

Pippa Stevens

Thematic investing is back in the spotlight. Citi and others share how to play it

Weizhen Tan

Citi's stocks to play the biggest themes of our time like automation and AI

Sarah Min

This is one of Goldman's best-performing stock portfolios this year for clients

More In Investing trends

News Tips

Advertise With Us