① Karen Karniol Tambour, Co Chief Investment Officer of Bridgewater, stated that there is still "room for growth" in the US stock market, but it is not the best investment location as investors have a significant exposure to the stock market She suggested that clients turn their attention to bonds, gold, or oil to cope with economic growth or inflation shocks.
Karen Karniol Tambour, Co Chief Investment Officer of Bridgewater Associates, the world's largest hedge fund, stated on Tuesday that the booming US stock market still has "upside potential," but that does not mean it is currently the best place to invest.
She said, "I think few people need to buy more stocks
After last week's US presidential election, the US stock market soared to a record high, and Wall Street strategists have raised their expectations for the US stock market's trend before the end of the year. For example, data from JPMorgan's trading department shows that the frenzy in the US stock market will continue until the end of the year, and the upward trend will be stronger than at the end of 2016 (when Trump won the US election for the first time).
According to data from Bank of America, investors have responded by increasing their exposure to US stocks to the highest level in 11 years, as they remain optimistic about economic growth under the leadership of President elect Donald Trump.
But Karniol Tambour said, "What you can't ignore is that people's exposure to the stock market today is completely different from usual. People's exposure to the stock market is very large
She is concerned that many investors no longer have the favorable conditions to withstand shocks. She pointed out that the "classic investment portfolio" that used to consist of 60% stocks and 40% bonds has now become 80% stocks and 20% bonds.
Karniol Tambour said she told clients that their next step should be to focus on things that may be helpful to them in the event of economic growth or inflation shocks, whether it's bonds, gold, or other commodities such as oil.
She said that in times of economic growth shocks such as war or financial crises, bonds can better protect investment portfolios, while in times of rising inflation, gold, oil, and other commodities are preferred.
I like to have both elements in my investment portfolio, "she added.
However, at the same time, Karniol Tambour also said that there are still "many reasons to believe" that the current stock market "has room for growth". She pointed out that the current situation is very similar to 1998, when the S&P 500 index rose by 28% and the Federal Reserve was in the process of loose monetary policy.
She said, 'I think we already have a way to expand.'. However, she stressed that the Internet foam burst after 1998.
"Obviously, the foam that burst in 1999 was very, very detrimental to people's investment portfolio for a long time," she added.
Karniol Tambour also added that Trump's proposed comprehensive tariffs, immigration policies, and tax cuts may have a comprehensive impact on the US deficit, raising concerns about the possibility of inflation starting to rise again.
The market basically tells you, more or less, that Donald Trump means to some extent favorable to growth, and to some extent implies inflation. "She said," Even if the stock market outlook is optimistic, you must diversify your investments