The Globe and Mail attempts to identify top-performing financial-services companies in its Friday edition. The Globe's guest columnist Cary Christie, head of research at Trading Central in Ottawa, writes in the Number Cruncher column that the S&P 500 index has broken above a four-month consolidation period to new record highs. Defensive utility stocks, which have been outperforming the S&P 500 since July, have fallen slightly out of favour in the past 30 days, replaced by financial stocks. The Financial Select Sector SPDR Fund is up 7.5 per cent in the past month. Mr. Christie used traditional value investing criteria to identify well-valued financial companies. His picks had to have a minimum market capitalization of $5-billion. He focused on large-cap names in the market owing to the greater stability and safety that they offer. He looked for companies with a price-to-earnings ratio less than the average P/E of the S&P 500 financial sector, among other investing criteria. Five Canadian names made it onto Mr. Christie's "Select U.S.-listed financial stocks." Mr. Christie recommends buying Manulife Financial, Sun Life Financial, Bank of Nova Scotia, Royal Bank of Canada and Toronto-Dominion Bank.
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