With the Fed’s taper plans looming, investors can expect more big declines after the latest market sell-off, but that could create opportunities for stock pickers, top strategists told CNBC on Friday.
“There is a lot of money that needs to be repriced and move into different places,” Okada said. He also suggested that retail investors look into buying bank debt through ETFs or managed funds as broad economic factors improve.
In addition, Okada sees “dislocation” in the fixed income space. In such a situation, individual muni bonds can be a “great buy” when supported by underlying economic strength in local areas like Texas. However, it can be difficult for retail investors to have the needed perspective to make the right choices in the muni market, so putting money with an active manager could help.
Long-term, Okada is positive on the economy, but he called expectations of a calm market response to the start of the Federal Reserve’s tapering of easy money a “fairy tale.”
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