Overview of KBE
The SPDR S&P Bank ETF (KBE) seeks to track the returns on the S&P Banks Select Industry Index. KBE has a market capitalization of $3 billion as of November 10, and an average of 1.2 million shares trade hands every day. The fund invests in a portfolio of publically traded money centers and leading regional banks. Approximately 80% of its holdings are concentrated in regional banks.
KBE’s largest holdings are Bank of the Ozarks (OZRK) and Western Alliance Bancorporation (WAL), both of which comprise 1.9% of the ETF, as well as Cullen/Frost Bankers (CFR), First Niagara Financial Group (FNF), and Fulton Financial Corp (FULT), all of which have 1.8% weight in the ETF.
Moving average analysis
On November 6, 2015, KBE closed at $36.59, above its 100-day moving average of $33.34, its 50-day moving average of $34.08, and its 20-day moving average of $34.87. The chart above shows that KBE crossed over its 20-day moving average on November 6. Currently, it trades above all its moving averages.
KBE’s 14-day Relative Strength Index (or RSI) was 61.5 on November 6. The RSI for KBE has improved from its reading of 36.5 on September 4. This suggests the ETF is nearing overbought levels and may be considered overvalued. An RSI figure below 30 is an indication of an oversold stock while an RSI above 70 denotes an overbought stock.