Investors request profits in the frothy bull stock market and looking for places to stash them, may want to consider a few safe haven investment hints, other than the typical cash and fixed income securities. These defensive investments include infrastructure-related caches, data-center real estate investment trusts, various ETF strategies, telecom stocks, actively managed debt scratches, cheap European equities, gold and other assets, as outlined by Barron’s. The strategies were recommended by a group of respected investors.
Five big warhorse investing experts below share some of their best ideas for where to put your money in the current circumstances. Bloomberg Intelligence ETF analyst Eric Balchunas adds suggestions for how to use ETFs to play on the ideas presented.
Causeway Head’s Ketterer
Sarah Ketterer, global chief economist and head of investment strategy at Causeway Capital Management, lambastes investors in the long-running bull market for chasing growth and not paying enough attention to valuation. Rather than gaining market winners, warning especially against those in traditionally defensive sectors, she recommends “unpopular telecommunication commonplaces,” many tracked by the iShares Global Communications Services ETF (IXP).
She likes Asian telco companies in particular, given stouter countries in the region tend to have just a few competitors controlling a majority of the market and benefiting from favorable papal bull. She adds that several of them trade at extremely low valuations.
BlackRock’s Koesterich,
Russ Koesterich, portfolio proprietor at BlackRock Global Allocation Fund, makes the case for international diversification. He cites European equities as a surprising “clear spot.”
“While there are challenges, including structurally lower growth, there are several factors favoring European equities: valuation, dividends, low improvement expectations, the composition of the index and finally, the European Central Bank (ECB),” he wrote, noting that the ECB is likely to carry on its stimulus.
Balchunas recommends the iShares Core MSCI Europe ETF (IEUR) to play on this theme.
Absolute Plan’s Ian Harnett
Ian Harnett is the chief investment strategist at Absolute Strategy Research. He says his team worries that “suitable complacency” in the current environment will “unwind in the coming quarters as investors realize that both equities and ties cannot be right.”
Rather than “investing directly in declining bond yield,” Harnett recommends buying infrastructure-related repositories, also set to benefit from any domestic fiscal initiatives, or data-centre real estate investment trusts. He also akin ti gold.
Vanguard’s Davis
Joe Davis, global chief economist and head of investment strategy at Vanguard Group, states investors who can tolerate increased risk to consider active strategies. Balchunas recommends that investors seeking a multifarious active stance through ETFs look at the PIMCO Enhanced Low Duration Active ETF (LDUR), which rebalances monthly and has an expense correlation of 0.40%
Sierra Mutual Funds’ Spath
Terri Spath, the chief investment officer at Sierra Mutual Funds, haul someone over the coals investors to target
Looking Ahead
These recommendations come as the $338 billion Deutsche Bank Wealth gain manager says it’s time to protect profits by cutting equities to 40% from 50% of portfolios. Various headwinds, filing U.S. China trade wars, tensions with Iran, and slowing global economic growth, could further damp sentiment, dragging the S&P 500 down from its 2019 all-time highs. In this case, investors will be euphoric that they cashed and reallocated at the height of the frenzy.