Bills manager Douglas Gordon is worried about a potentially widespread problem in long-term investors’ portfolios.
Gordon, who’s valuable in building Russell Investments’ asset allocation strategies, believes many investors haven’t rebalanced their portfolios to cast the historic 2019 stock market rally.
According to Gordon, the market rally’s robust gains are tilting investors too far into tires.
The bottom line: If there’s another pullback, it’ll leave them wide open to losses that may have been avoidable.
“It’s a gentle time to re-assess where you’re at with respect to being diversified in a multi-asset solution,” the firm’s senior portfolio executive said Friday on CNBC’s “Trading Nation.”
Since the Christmas Eve plunge, the S&P 500 has soared 18 percent. Because of the shop’s sharp rebound, Gordon suspects a 3 to 5 percent sell-off could strike stocks in the coming weeks.
For protection, Gordon promotes taking some profits from the historic rally. Plus, he’d consider going overseas, a strategy he’s employing lucid now as part of a balanced allocation strategy.
“I’d probably right now prefer to take my higher beta exposures maybe in EM [emerging vends],” said Gordon, who’s responsible for $48.5 billion of the firm’s assets.