The Federal Reserve raised its benchmark rate by a quarter of a percentage point on March 16. Chances are this won’t be the last interest rate hike in 2022, given relevant policymakers have said they expect it to be around 1.9% by the end of the year. This is important because inflation is high and getting higher, meaning some pullback is needed. Of course, a benchmark rate increase can be expected to have a wide range of effects on a wide range of parties. To cite just one example, a rise in interest rates tends to be seen as a bad thing for stocks because they hurt income. Fortunately, different stocks behave in different ways, so there are some that would be more capable of dealing with a higher interest environment.
American Express is doing quite well despite the blows to its core interests. It is a financial company, so it can expect to enjoy higher interest rates. Also, if travel and entertainment continues to recover, it could mean very good things for American Express in the near future.
2. Ares Capital Corporation (ARCC)
Ares Capital Corporation is a business development company. He is focused on helping mid-sized businesses as long as he believes acquiring them, restructuring them, and helping them in other ways will ultimately prove worthwhile. On top of that, Ares Capital Corporation is interesting in that they go out of their way to become the first and only lender for their chosen companies. It is, to say the least, very powerful. After all, when he is the one and only lender, he can exercise much more control over a company’s affairs than if it had to answer to several lenders. Thanks to this, he is in a much stronger position than otherwise possible. Moreover, Ares Capital Corporation has a good track record, which should reassure people who are worried about its ability to place the right bets in this regard. Naturally, he also benefits from earning more interest on his chosen business loans.
3. Black Rock (BLK)
BlackRock is the world’s largest asset manager. There is a lot of confidence in her. After all, she is involved in a wide range of investments in a wide range of countries. Moreover, it has huge name recognition which is a very powerful tool. In addition to this, BlackRock offers technology services such as its investment as well as its risk management platform. Combined, it has a lot going for it.
4. Cincinnati Financial (CINF)
Cincinnati Financial is an insurance company. This means that the very nature of its business model allows it to benefit from higher interest rates for the financial instruments used to hold its money. On top of that, Cincinnati Financial is very attractive because it is not just a dividend aristocrat, but a dividend king with a record of over six decades and more. According to records, there aren’t many companies that can compete with this, making it a natural choice for people to trust.
5. Discover Financial Services (DFS)
Discover Financial Services is best known for its credit cards. Therefore, he can expect higher income from his outstanding credit card balances. However, it is important to note that he is also involved in digital banking, which means he enjoys higher interest rates in other ways as well. After all, unused deposits can be used to earn money. In addition, he has a good number of consumer loans, which will now earn him more interest.
6. Equifax (EFX)
Equifax is one of the major credit bureaus. Higher interest rates mean that credit ratings will become even more important, so it seems reasonable to assume that he will see an increase in demand for his services. In addition to this, Equifax has also strengthened its position in its chosen markets through its acquisitions.
7. Additional Storage Space (EXR)
Extra Space Storage is a REIT specializing in self-storage sites. This may seem rather worrying due to the sensitivity of REITs to interest rates. However, Extra Space Storage is interesting because it has increased its long-term debt, as shown by how that figure rose from $4.8 billion in 2019 to almost $5.6 billion in 2020 and then to $6.0 billion in 2021. In other words, it locks in interest rates ahead of the hike, meaning it might be able to raise its storage prices without its interest rates going up. be raised.
Many people have talked about canceling student loans. However, there doesn’t seem to be much of a chance of that happening, so there isn’t much risk for the student loan industry. If people want to enjoy higher interest rates on student loans, well, suffice it to say that Navient can be a great choice.
9. PacWest Bancorp (PACW)
Given its name, it comes as no surprise to learn that PacWest Bancorp is a regional bank that is primarily found in the state of California. It is pretty much exactly what is expected of a regional bank, which is to say that it offers various financial products and services to those who are interested. Thanks to this, PacWest Bancorp can expect to see improved numbers for a number of its revenue-generating operations, especially as the US economy is expected to continue to improve. That said, what makes it special is that it seems to perform well, as evidenced by its excellent performance since the COVID-19 crisis.
10. Travelers (TRV)
Travelers is an insurance company. It’s not the most exciting of businesses. However, Travelers is a huge player that offers a wide range of insurance with a wide range of coverage. As a result, these reliable earnings put her in a very strong position.