Vivenne Hsu likes how the world is treating materials, especially steel and chemicals. She co-manages the Schwab Hedged Equity fund , rated four stars by Morningstar for its returns: 12.16 percent over the last five years and 5.87 percent over the last three. The 4-star manager offered CNBC her top materials stocks.
Hsu praised AK Steel as a global construction play with "good fundamentals," particularly in its "ability to generate and grow free cash flow." She agreed with CNBC's Dylan Ratigan that the metallurgy company's valuation is a little rich but that that factor is more than offset by its momentum.
On the chem side, Hsu likes Celanese.
"They derive about two-thirds of their sales from outside the U.S. -- a good alternative to investing directly outside" America, she said.
The fund manager added that Celanese has "been able to surprise the market in eight out of the last nine quarters in earnings." She cites the chemical giant's efficiency and operations' "financial strength."