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Bryn Mawr Trust WM Investment Advisor Eric Thorne on the opportunities for investors in stocks.
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-- -- -- later my next guest calls himself a cheerleader for equities and says improvements.
In certain fundamentals.
Will -- -- power uncertainty.
-- what areas do you see the bottom when it comes to real growth -- Florida -- mark trust wealth management.
Investment advice is joining me now in a Fox Business exclusive.
You were right all -- -- you were pro equities the markets went like this even though angst was like this.
So what do you see in 2013 you are still very much a cheerleader for equity.
Absolutely I don't think we're have to -- all I think equities are going to be just fine on their own what we're actually looking for this year is another good solid year for stock market investors why.
Well when you really look at the other choices that investors have most investors only have equities bonds -- cash.
And cash is yielding zero.
Bonds were sitting here at all time low interest rates so if interest rates start to move up even a little bit here with a strengthening economy you're gonna get to start.
Getting bond prices to go down.
That's going to be bad so again equities become the asset class a choice just like we were saying last year.
And on top of all that you have improving fundamentals which we really didn't have last year were just starting to see that.
Now -- -- we talked about companies with.
Billions on the balance sheets in -- one point seven trillion dollars so.
It we've we've got a beatle song it's getting better all the time you know that that's really the theme that you have here everything from housing.
To what's happening with the unemployment picture but when it comes to.
Company -- enough confidence that they would take that.
One plus trillion dollars and say we're now putting it to work maybe they've just gotten so freely captain's scared that.
They don't want to this chart shows that year after year of except for others -- you know it's continued to climb when -- came to them hoarding cash.
What he said -- finally put it to work.
Well I think there's a lot that's gonna start to happen as you start to get the unemployment rate going down more people at work.
-- also gonna start to see the pressure to continue growing earnings you know we're gonna see earnings growth this quarter but probably only about three to 4%.
The pressure to grow corporate earnings to get multiples higher is gonna intensifies -- gonna start to see acquisitions -- they're gonna start ST America's happen.
And you're gonna start to see companies really start to invest again to try to grow the top line against earnings growth in some ways can be manipulated you can get earnings growth -- through cost cutting.
But to actually start to grow the top line companies are gonna have to start to really invest in their business and I think as the economy starts to show improvement this year real improvement.
You're gonna start to see some of that money go to work you have to ideas for our investors break it down -- start with your fund that you like over with art.
Yet what we've seen S&P 500 type companies do real well recently we think actually what's gonna start to happen.
And what happened in the fourth quarter is the international play.
They'll as hard.
International equity fund is a very solid fund and we saw -- real outperformance in the fourth quarter we look at this entire one year chart it does look very good now they're at their particularly exposed to developed -- 69% of that they also have.
A bunch of that's in the UK -- you're not worried about Europe.
Well for certain parts -- Europe are still pretty scary but the beauty of a fund like this is that.
The stronger part to Europe sold off also last year and not for good reason that the Nordic Countries the Germany's.
Those those economies are actually still very strong and did not get hit as much as a lot of investors thought let's say I wanna go a little bit riskier with emerging markets -- that fund.
Well the Oppenheimer developing markets fund is a beautiful fund if you want to play.
The emerging markets and Asia to it's got much more exposure in Asia it and then we'll -- -- it really does and the other is a lot to be said for slowing growth in China last year was a big story.
And of course as the as the economy like China starts to get bigger and bigger to have to slow -- that's just the law of large numbers.
But again China's growth rate India's growth rate still the envy of the world and you're gonna start to see some really exciting things happening here in the next twelve to eighteen months we will put.
Eric's picks up on the FaceBook dot com slash Liz -- page if -- were a mood -- he be flashing neon orange thank you so much good to see you great to be with Hewlett.
