Glenn Greenberg of Brave Warrior Advisors, a value investor known for his concentrated bets, said he is long financial shares including JPMorgan, Primerica and Charles Schwab in a rare interview with CNBC's Kelly Evans.
"We made a big bet that normal interest rates would not stay at zero," said Greenberg. "It was that simple. And we didn't know when they would change, but the payoff we felt would be substantial so we have had a lot of financial stocks in our portfolio the last couple years."
Greenberg started Brave Warrior in 2009 near the start of the bull market after more than two decades at Chieftain Capital Management. Greenberg said he owns only about 10 stocks in his portfolio right now.
The investor made clear he is a stock picker and he is not sure how the overall economic picture will play out, but it is more likely than not that rates go higher and the economy ramps up from here.
"Rates could go a lot higher. Inflation could go a lot higher," he said.
On JPMorgan specifically, Greenberg said, "They should be earning $8 or $9 in a couple years if rates track at the moderate increases that are in the [Federal Reserve's] dot plot."
Other topics in this special "Value Spark" interview include:
- Four things he looks for in a stock
- Other holdings: Airbus, Express Scripts
- Why Valeant was the biggest mistake of his career
The in-depth interview with the money manager is an exclusive for CNBC PRO. Only a few highlights will be broadcast on CNBC TV.