Traders should beware of another pullback ahead, expert says
Markets (^DJI,^GSPC, ^IXIC) rebounded last week in their best-performing week of this year. However, Howard Capital Management CEO and portfolio manager Vance Howard sees a pullback ahead. He joins Wealth! to break down some of the most recent market movement and how investors should prepare for volatility ahead.
"I'm very much bullish, but I think whenever you've had six, seven, eight, nine days in a row that are up, you're going to get a three- to four-day pullback. So I think maybe if you're a trader, you may want to look at scaling out and then looking to re-enter. As an investor, I think you're just fine. Continue to trade the trade," Howard explains. Despite earlier volatility caused by the unwind of the yen carry trade, he notes that overall, he remains bullish.
As interest rates start to ease, Howard notes that the real estate sector will become more profitable alongside the growth of small-cap stocks. Thus, he encourages investors to consider taking positions in real estate investment trusts and high-yield dividend-paying stocks. He adds, "Look at the value of the company, though. You really got to go back to the fundamentals. Go back to your Warren Buffett philosophy of looking at really a value play. And there's some great stocks out there. But if you don't want to spend the time looking for a great stock, look at a good ETF like DVY (DVY) or VIG (VIG)... that way, you diversify your risk with one investment."
For more expert insight and the latest market action, click here to watch this full episode of Wealth!
This post was written by Melanie Riehl