Goldman Sachs Group Inc likely has the most to lose among global investment banks from a new regulation that limits proprietary trading, analysts at J.P. Morgan Securities said, and downgraded the stock to neutral.

The brokerage, which previously rated Goldman overweight, said its downgrade is valuation-driven, as shares of the company have outperformed peers by about 17 percent since an upgrade last July.

Goldman Sachs is the best-in-class liquidity provider today, but potentially has the most to lose from the new regulation, JP Morgan said, adding the bank is now less attractive against its global investment bank peers.

JP Morgan now prefers European investment banks over their U.S. peers as it expects the new Volcker rule -- which bans proprietary trading by banks -- to materially benefit European investment banks.

The brokerage revised its pecking order for global investment banks, ranking Swiss bank UBS AG at the top, followed by Credit Suisse , Morgan Stanley , BNP Paribas , Societe Generale , Barclays Plc , Goldman Sachs and Deutsche Bank AG .

On Tuesday, Goldman revealed for the first time how much it made from trading and investing on its own behalf and pledged to be more open about how it makes money.

Goldman shares closed at $169.36 on Tuesday on the New York Stock Exchange.