A gilded era for banks is about to get underway. That’s the view of Steve Eisman, the hedge-fund manager and investor who garnered prominence on Wall Street for his bets against dicey mortgage products engineered by some of the world’s biggest banks.

Eisman, whose story was told in Michael Lewis’s “The Big Short,” wagered correctly that these mortgage securities would eventually rock the financial system to its very core

Now, Eisman is espousing a much more bullish position in the banking sector, which has benefited mightily from President-elect Donald Trump’s promises to roll back a spate of financial regulations. Proponents of deregulation claim new rules ushered in along with the Dodd-Frank regulations in the aftermath of the financial crisis have hemmed in large lenders, hampering their profitability.

But Eisman, who works at money manager Neuberger Berman, says the era of Trump will be a “golden age” for the banking sector. “I think over the next couple of years there will be more leverage, and this will be a golden age of investing in financial stocks,” he told CNBC during an interview early Monday in New York.

He said he was “as long as he could be” in the banking sector.

It is hard to take issue with Eisman’s bullish change of heart for financials. Shares of Goldman Sachs GS, -2.87% have risen 31% since the outcome of the Nov. 8 election, representing the best performer among the 30 components of the Dow Jones Industrial Average DJIA, -1.92% . Those moves have helped the blue-chip gauge to march to the brink of a major milestone: the 20,000 level.

The S&P 500 index SPX, -2.37% and the Nasdaq Composite Index COMP, -3.01% also have enjoyed healthy bounces to records.

Other measures of the financial universe have risen sharply postelection. The Financial Select Sector SPDR ETF XLF, -2.23% , which tracks performance of the S&P 500’s financial sector, had been among the broad-market benchmark’s worst performers. It is now on track to post the best year-to-date return, outside of the energy sector, of the S&P 500’s 11 sectors. The bulk of those gains have come in the past 30 days or so, after banks have spent the bulk of 2016 in the doghouse.

Liz Ann Sonders, chief investment strategist at Charles Schwab & Co, told CNBC Monday afternoon that “eight years of underperformance” for bank stocks during an extended bull market for equities suggests there’s still more room to run for the financial sector. She said she only rates two sectors overweight (that’s code for buy among Wall Street researchers), and those are financials and technology.

Valuations for bank shares have surged but are still modest. Price-to-earnings ratio, a measure of a stock’s relative value, suggests that financials are cheap relative to the overall stock market. For example, the S&P 500’s five-year average P/E is 15.70 compared with about 10 for J.P. Morgan Chase & Co. JPM, -1.62% and 13 for Goldman Sachs, according to FactSet data.

It is worth maintaining a modicum of skepticism about the banking sector’s ability to extend those rich gains into 2017. Firstly, it’s unclear if Trump will be able to deliver on his ambitions to loosen the reins on lenders and cut corporate taxes. Other market participants also have warned that rapidly rising interest rates may result in loan losses in other areas of banks’ balance sheets, including in auto lending.

The surge in bond yields, highlighted by about a percentage-point climb in the benchmark 10-year Treasury note TMUBMUSD10Y, 0.668% since July, implies that the climb in interest rates—beneficial for banks’ business models—may have exhausted itself, with further gains likely limited.

Check out the rest of Eisman’s interview below: