Investors are juggling lots of worries — trade tussles, recession threats, both for the economy and earnings, as well a looming U.S. presidential election. And then there’s the chance it will all turn out A-OK.
Our call of the day, from John Linehan, portfolio manager for T. Rowe Price’s Equity Income Fund, says if investors want some protection from all that could go right or wrong, they need to balance their investment strategies.
“I don’t think now’s the time you want to aggressively tilt your portfolio, either to prepare yourself for an economic downturn, or to prepare yourself for the economy to go gangbusters,” Linehan told MarketWatch in a recent telephone interview.
Investors need to be “opportunists” — pick stocks that offer upside opportunity if the economy avoids a downturn, but some downside protection if it doesn’t, he says. With that, he offers up three stock ideas, starting with Wells Fargo
“What we’re trying to do is find a significant asymmetry where there’s a lot more upside than downside and Wells [Fargo] would be an example of that,” he said. The bank, which also reports Tuesday, has a strong balance sheet with excess capital that can be used for shareholder buybacks and trades at a discount to regional banks.
owner of Fox News and Fox Sports channels, is his third pick. While the media group has some exposure to the economy, it would probably weather any storm, he says. (Note: Fox Corp. and MarketWatch parent News Corp.
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