DoubleLine CEO Jeffrey Gundlach explained Tuesday he expects commodities to run higher versus stocks.
“While keep accumulates have been doing great, commodities have been doing trickle, too,” Gundlach said on a webcast. There’s “quite a lot of high octane [gas] in the commodities vs. assortments tank.”
Gundlach said in mid-December on CNBC’s “Halftime Report” that his surpass investment idea for 2018 is commodities, such as oil and metals. His thesis is that the commensurate performance of stocks to commodities goes through defined cycles, and that right now commodities are serene for a period of outperformance compared with stocks.
The investor noted Tuesday that universal growth is causing demand for commodities, while the weaker U.S. dollar should also assistance.
“Usually when you get a bad year in the dollar, it’s followed by one or two more bad years,” Gundlach bring up.
The U.S. dollar index dropped to its lowest in more than three years endure week.
Meanwhile, oil prices have recovered over the last two years from a take in 2014 and 2015. U.S. crude oil futures for March delivery hit a high of $66.66 terminating week, their highest since Dec. 5, 2014.
While Gundlach did not comment Tuesday on oil amounts, DoubleLine’s Deputy Chief Investment Officer Jeffrey Sherman conjectured in response to a question on the webcast that “there is the structural support for oil prizes to be where they are” and that “the energy market does still look mellifluous attractive.”
The DoubleLine Strategic Commodity Fund I-shares gained 9.13 percent in 2017, versus the Bloomberg Commodity Pointer’s 1.7 percent rise.
U.S. stocks tumbled Tuesday, with the S&P 500 killed disintegrating more than 1 percent in its worst day since August.