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Got Utilities, Telecom & Bonds?

Fast Money Portfolio
Fast Money Portfolio

Sometimes the best offense is a good defense.

So says, Stephen Bodurtha, Citi Private Bank Head of Investments for North America on CNBC’s Fast Money.

Despite record low yields on the 10-year, Bodurtha tells us that he still thinks one of the best defensive plays available to investors is long US Treasurys. “I think both intermediate and longer term bonds have more upside,” he says.

“A year ago, we were telling people to buy bonds when the 10-year was yielding 3%. That turned out to be a good move. We still think that’s the best place to be – in fixed income. And we think intermediate and long-term bonds have more upside,” he says. “It’s a good place to be.”

Also he suggests establishing long position in utilities and telecom stocks.

Bodurtha's thesis is simple: he believes that weakening economic growth overseas as well as a diminished appetite for risk after the financial crisis, will quickly send investors into risk-off mode.

“We’ve got a challenged situation. The developing world is weakening a lot, that’s a key focus,” he says. “And risk appetite has dialed down. That’s why we like defensive plays – in both bonds and selective areas of the stock market.”

* Citi Private Bank works with one-third of the world’s billionaires overseeing $250 billion in assets under management.

Posted by CNBC's Lee Brodie



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Trader disclosure: On May 31, 2012, the following stocks and commodities mentioned or intended to be mentioned on CNBC’s "Fast Money" were owned by the "Fast Money" traders; Keith McCullough is long XLU; Joe Terranova is long VRTS; Joe Terranova is long MCD; Joe Terranova is long PNC; Joe Terranova is long USB; Joe Terranova is long TCBI; Joe Terranova is long SBUX; Joe Terranova is long SJM; Joe Terranova is long UPL; Joe Terranova is long WFM; Joe Terranova is long AAPL; Joe Terranova is long EMC; Joe Terranova is long NXPI; Joe Terranova is long LPX; Joe Terranova is long SNDK; Joe Terranova is long IBM; Joe Terranova is long CNX; Joe Terranova is long LQD; Joe Terranova is short JUNE MINI S&P FUTURES; Steve Grasso is long ASTM; Steve Grasso is long BA; Steve Grasso is long D; Steve Grasso is long FRO; Steve Grasso is long LNG; Steve Grasso is long MHY; Steve Grasso is long MO; Steve Grasso is long PFE; Steve Grasso is long S; Steve Grasso is long XLU; Steve Grasso is long ZAZA; Mike Murphy is short JPM; Mike Murphy is long TGT, Mike Murphy is long FDX; Jon Najarian is long FB CALL SPREADS; Jon Najarian is long DAL CALL SPREADS; Jon Najarian is long JPM CALL SPREADS; Jon Najarian is long GS CALL SPREADS; Jon Najarian is long VIX CALL SPREADS; Jon Najarian is long CIGX; Jon Najarian is long DDMG; Jon Najarian is long CME; Jon Najarian is long CBOE

For Amelia Bourdeau
No Disclosures

For Scott Kessler
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