US Markets

Tom Lee says this sector will be the easiest trade in the next 5 years

An employee inspects semiconductor chips.
Dario Pignatelli | Bloomberg | Getty Images

In the next five years, technology may be the easiest trade to make, Tom Lee, founder of Fundstrat Global Advisors, said Thursday on "Squawk Alley."

With policies turning away from regulatory creep on big business, and toward pro-business initiatives, Lee said investors should look at banks, energy, tech and telecoms. While the technology sector has not performed well in the past couple of months — the sector ETF XLK is up less than 1 percent this quarter — Lee said historical patterns may hold optimistic signals.

"When you think about wage inflation, we have to go all the way back to the '50s to find a cycle led by wage inflation," Lee said. "Businesses in the '50s spent a lot of money on technology to offset wage inflation — I think it's going to be the same story — and so tech has a chance to really re-rate."

Looking to next year, he pointed out that the first half of 2017 could end up being "pretty treacherous." He noted that in the first half of a year with a new president, three quarters of the time, the market sees a drawdown of almost 10 percent.

In terms of which sectors could see the biggest growth, Lee said that "banks have been doing nothing for 10 years," which could lead some investors to think that there's a lot of room for them to run.

He said he sees many of his clients looking back to the playbook of 2015, but he thinks its time to buy a completely new group of sectors, such as financials, energy, tech and materials.