With President-elect Donald Trump’s inauguration less than a day away, investors are anxiously waiting to see what new regulations could influence bank outlooks.
However, for David Ellison, a portfolio manager for Hennessy Large Cap Financials Fund, he’s more concerned with rates changing.
« Companies are earning good money now, and there is tremendous amount of money to cut costs and right-size the business. You built the business on a 30-year decline in rates, » Ellison told CNBC’s » Closing Bell » on Thursday. « That’s why they’re so big, because the asset prices always went up. Now you’re going to build a business on flat to up rates, which means a totally different business and that’s what we’re moving towards. »
But in regards to regulation, Ellison doesn’t support repealing the Dodd-Frank Act like several others on Wall Street are advocating for the Trump administration do. Instead, he hopes the reforms and policies will be just be « incremental changes. «
