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  • Writer's pictureIshfaaq Peerally

Is JPMorgan Chase Stock a Buy in 2021?

I've been buying and holding JPMorgan Chase $JPM since 2016. JPMorgan Chase is the largest bank in America by AUM ahead of Bank of America $BAC and the largest bank in the world by market cap. It is a very diversified business, being the largest retail bank in the US, largest investment bank in the world ahead of Goldman Sachs $GS and is also a custodian bank. Through proper branding, JPM is expanding both domestically and internationally. Domestically through the Chase brand and Internationally through the JPMorgan brand.

Banks are having a hard time with the zero interest rates, the Dodd-Frank Act of 2011, and quantitative Easing. For this reason, JPM (and the other banks) cannot operate with high profit margins.

This challenging environment is an opportunity. Sooner or later, the Federal Reserve System will have to raise interest rates, especially if we have inflation. Now is the time to invest in banks. There is a premium on JPM stock but it has vastly outperformed its peers and the S&P 500 $SPX500 .

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