The stock market next year will likely head into a period of heightened volatility against the backdrop of what's expected to be higher interest rates by the Federal Reserve, portfolio manager Larry Glazer said Monday.
Smart stock and sector picking can still prevail, the managing partner of Mayflower Advisors told CNBC's "Squawk Box."
"The market is waiting for that rate hike" at the Fed's mid-December meeting, Glazer said. "It would have to be a disaster for the Fed not to raise rates and still maintain any credibility right now."
For the year, the S&P and Nasdaq were solidly in green as of Friday's close. The Dow, however, was still fractionally in the red for the year.
"I would tell people not to be too long here, not to be too aggressive on the market," said Glazer, whose Boston-based firm manages $2 billion in assets.
"I don't think you want to be a uniform bear on things here. But you have to realize that the easy money has been made," he said. "The buyback business is over. Investors are going to need to find businesses that are executing, and those are fewer and farther between." Stock buybacks tend to dry up in a rising rate environment, he added.
"It won't be the mega-cap, buy it all, all you can eat market," Glazer said. "But there will be specific sectors, lots of opportunities. And investors can be very selective and still make money."
"Heightened volatility can be your friend," he continued. "You can trade that heightened volatility because it means certain sectors get left in the dust."