It's the right time to be a diversified investor, for now, expert says

Positioning for rest of the year

One strategist says 2016 is a terrific year to be a well-diversified investor, for now.

"One, because bonds have been excellent stabilizers for the few air pockets we've hit with stocks to help stabilize portfolio," Jeff Knight, co-head of global asset allocation at Columbia Threadneedle Investments, said on Thursday.

"And two because the more diversified assets like commodities or credit or emerging markets have done very well," he told CNBC's "Power Lunch."

Knight cautions, however, that the bliss may not last until the end of the year. He said due to the easy money environment, "so many of these things have been bid up in price" and could come back down.

The Federal Reserve raised its federal funds rate in December, but rates are still at historically low levels. Analysts say the Fed is likely to hike rates at least once in 2016, either in September or at the end of the year.

Knight also said banks and the rest of the financial sector have been flat but are now starting to break out, "fitting with the theme of the benign environment."

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