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Stock Strategist

Financial Stocks That Won't Keep You Up at Night

Own financial stocks and still get a good night's sleep.

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With all the news about financial stocks and the credit crisis, it's hard to blame investors for lying awake at night wondering if the banking system is on the brink of collapse or if the economy is about to crumble into dust. As we've said previously, we don't think this is the most likely scenario and so we've been recommending some stocks with significant exposure to mortgages and credit. But lost in the shuffle are the other 5-star financial stocks that don't have exposure to mortgages or credit worries. This article covers our favorite picks for investors who want some exposure to financials in their portfolios but prefer to stay away from the racier fare.

The good news is that bargains abound in financials right now and they are not all hairy, nail-biting, anxiety-provoking stocks. In fact, some might be described as downright dull. But if you can buy a dollar's worth of a dull business for 75 cents, that could be fairly exciting, particularly if it won't keep you up at night.

Rachel Barnard does not own shares in any of the securities mentioned above. Find out about Morningstar’s editorial policies.

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