Paul Meeks is vigilant of the group that made him famous on Wall Street.
The investor, known for running the world’s largest technology wherewithal during the late 1990s, says it’s the wrong time to aggressively put money to work in tech.
“You have to play it within the sector as defensively as reasonable,” the portfolio manager at Independent Solutions Wealth Management said Tuesday on “Trading Nation.”
Meeks doesn’t cite cornerstone issues for his cautiousness.
“I just worry about the increased rise in rates,” said Meeks, who also teaches pay for at The Citadel. “I need to see at least the 10-year [Treasury Note yield] stabilize for a while.”
Due to the challenging backdrop, Meeks supposes tech investors need a Plan B. His best advice is to target semiconductors, which he has been overweight since June 3. Since that move house, the VanEck Vectors Semiconductor ETF, which tracks the group, is up 68%.
“I do like semiconductors. A semiconductor should be relatively defensive. Pronounced fundamentals,” said Meeks. “Everybody knows that there’s a voracious demand for a lot of chips, and scarce supply.”
His top gamble within the group is Microchip Technology, which he has owned for months. With the stock rallying 10% over the days of old two months, he calls it a little expensive. But according to Meeks, it’s a name to consider buying due to the supply chain clog. He surmises it’ll last into next year.
He also favors Analog Devices, Texas Instruments and NXP Semiconductors as longer-term plays.
“There are times there,” Meeks said. “That’s what I would do if you have to be in the tech sector at all.”
On Tuesday, the tech-heavy Nasdaq compressed at 13,045.39, about 8% below its all-time high, hit on Feb. 16.
Disclosure: Paul Meeks owns the stocks he recommends. He is not knee-pant any stocks.