Expect gains, volatility in US markets: Analyst

Opportunity in volatility
Opportunity in volatility   

Despite a rough start to the year, U.S. markets will see gains in 2015, according to one analyst.

Jeffrey Kleintop, chief global investment strategist at Charles Schwab, told CNBC's "Squawk on the Street" on Wednesday that he projects markets in the U.S. to rise in 2015. "We expect modest gains, not huge gains," he said.

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Traders work on the floor of the New York Stock Exchange.
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Traders work on the floor of the New York Stock Exchange.

Nevertheless, Kleintop added that investors will face a lot of volatility this year. "I think there's a new trend in volatility, one that many investors may not be prepared for in 2015," he said. "Equities will post gains in 2015 accompanied by a lot of volatility. If you haven't balanced your portfolio in a while, do that. "

Investors can protect themselves from the volatile market through dollar-cost averaging, Kleintop said. "I don't think trying to time the market is going to make sense," he said. "We've had nine trading days, four of those had more than 1 percent moves, and half of them down."

Investors can also protect themselves by investing in more stable emerging markets, Kleintop said. "That may sound crazy, but as of yesterday's close, [emerging markets] are flat relative to the U.S."

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The comments were made after yields on U.S. 30-year Treasurys dropped to a record low and yields dipped below October lows for U.S. 10-year Treasurys. U.S. markets were also hit hard by disappointing December retail sales numbers and by copper taking a beating.

He also said that, even though December retail sales numbers missed estimates by nearly 1 percent, the consumer does not worry him. "Consumer confidence surveys [are] coincidental with what's going on with retail sales," Kleintop said. He also added that retail sales in the U.S., the U.K. and Germany are all at post-recession highs.