This has been a great year for baskets of stocks, or exchange-traded funds, because of the macros headlines, but investors will slowly come back to fundamentals if the euro zone crisis is resolved, according to the managing director of Guggenheim Investments, Mark Bronzo.
“The market’s been driven by a baskets of stocks, so there’s been no separation in the market between individual stocks and their fundamentals versus the basket,” Mark Bronzo told CNBC Wednesday.
We could see a “reallocation or a more dynamic allocation in equity—that changes the game, and could really propel the markets higher [if things look better in Europe],” he added.
“So that combination with large-capbeing able to take advantage of some of the good things happening in the global economy should help large-cap growth,” explained Bronzo.
Although economic growth will be “very sub par” for a long time, at least probably for the next 12, 15 months, Bronzo noted. “As a result, people are going to crave individual stock stories.”
But should crisis in Europe not be resolved, “then this remains a good market for baskets," he concluded.
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