"I am moderately optimistic on the markets," said Leon Cooperman, chairman and chief executive of Omega Advisors. The hedge-fund legend shared his market strategy and advised investors where to look—and what to avoid.
“Our basic principal emphasis in the portfolio is energy, health care and financials and the rest are one-off picks at a time,” Cooperman told CNBC.
Cooperman said he is "underweight"consumer discretionary, and dislikesutilities and government bonds.
He also said he is not a fan of the reflation trade and that the Federal Reserve’s “free money” will remain until the unemployment rate reaches below 9 percent—sometime “very late” this year.
Cooperman is “very negative” on Treasury bonds and expects the 10-year Treasury rate to reach 4 to 4.5 percent.
“The 10-year rate can get in line with nominal GDP,” he said. “So if the real growth is 3 to 3.5 percent and inflation is a couple percent, you can see the 10-year go up to 5 percent or higher.”
“But we bottomed a year ago on the 10-year and my guess is we’re in store for 2 to 3 years of rising interest rates.”
- Watch Cooperman's Previous Appearance on CNBC (Nov. 11, 2009)
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- Market Will Be Volatile This Year: Strategist
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Top Financial Firms:
Bank of America
No immediate information was available for Cooperman or his firm.