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Buy Now, Don't Wait for the Dip

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  • Description

    Wells Fargo portfolio manager Margie Patel gives her outlook for the markets.

  • Duration 3:54
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All right well listen with the -- continuing to set new highs is it too late to buy into the rally maybe not.

My next guest doesn't think so she says investors should be averaging in now rather than waiting for a correction of buying on the -- Joining me Margaret Patel senior portfolio manager at Wells Fargo -- nearly.

One and a half a billion dollars under management -- thank you for joining us.

I mean listen to its third day of the economic news to Tracy's point is bad and we know that the Fed would just keep on printing either way you look at it that the the markets continue to move on -- Yes that's right and I think that's -- that's well put.

I think the economy has momentum on itself and Bernanke's made it very clear that if for some reason there was a bump in the road.

Concerning -- financial crisis here in Europe something like that.

They are prepared to keep pumping out the liquidity so any correction I think we'll be.

Mild and fleeting and really will provide that kind of old -- opportunity to jump in and end up really -- the vote.

And you say you should investors should average Jim explained that so.

And you know what particular -- -- should you average in that you like.

Yes well I think averaging yen really if you just said over the next few months -- -- a third third a third of whatever money I'd like to commit to the market.

I think these sectors that are going to do well are those that that have clear pass for growth that would be.

Companies in the energy space relating to the shale gas revolution I think they have many years of -- ahead of them.

I think health care looks very very good in spite of the health care law.

A big pharma can save a lot of money -- on -- new drug discovery cycle.

And there's a lot of M -- activity that says there might be a lot of takeovers -- be profitable.

And I -- even industrial company's capital expenditures are moving up here.

And also in the developing markets I think that'll be good sector to.

You know one sector that's really underperformed is tank.

So far but do you think you'll catch up a deal like the -- tech sector.

I'm personally underweight tech.

Because I think a lot of the traditional growth areas really aren't going to B have the kind of growth -- we saying.

Because we have a lot of transition the mood of the cloud and so forth.

I think it's going to leave a lot of companies.

Well behind on the kind of gross -- expect I think they're more like industrial cyclicals and the weaker links I think -- going to be very disappointing.

You know like should say the volumes of being a little mediocre which perhaps suggests a little bit of lack of conviction and the oldest talk about the great rotation out of bombs into equity is a hasn't been a tremendous outflow from treasury so.

There's still a lot of money hanging out there isn't there.

A yes there is and I think we see for individuals are having.

Much higher cash equivalent balances and you might think compared to history.

And it really mirrors what you see for US corporations they also have a lot more cash on the books I think it reflects the uncertainty that people have after the kind of the volatility we've had over the last few years so I think when we start to see money come in the equity market it will be all those cash equivalents.

Rather bond funds of now will be aside that there's a lot more -- -- to the market than about the we've seen even so far this year.

Because it all comes down to earnings likely companies so -- that profit margins are pretty good and overall pretty healthy can Lowe's earnings and that.

Healthy situation continue -- -- yes and they did it -- and I think we're going to see companies.

Maintain those historically high profit margins because -- change the way they operate be much more flexible.

A much more global in their businesses.

And also the cash flow just from existing processes so high they have the power to increase their dividends.

Very substantially from current levels.

Very good indeed -- but tells always -- thank you for joining us appreciate it.

Thanks.

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