Where should investors be putting their money—and what should they avoid? Doug Kreps, principal and managing director at Fort Pitt Capital Group, and Brett D’arcy, CIO of CBIZ Wealth Management, shared their investing “tricks and treats” in honor of Halloween.
“Where people should be afraid of is the spooky area of what’s going on in the commodities and the opposite with the dollar,” Kreps told CNBC.
“We think gold has well overstayed its welcome—like the unwanted guest at the holidays—and is due for a correction. Those moved up 48 percent over the year and demand doesn’t reflect it by any stretch.”
Kreps said the returning consumer will offer a few “treats” in the next few quarters.
“We think there’s a potentially huge treat with regards to global reinvestment in things like aircraft engines,” he said. “Companies like Microsoft , IBM , where they’re both going to benefit from not only the consumer but also the return of corporate investment.”
In the meantime, D’arcy said his “treat” is the pharmaceutical sector.
“It seems like a strange pick going into a recovery mode—you’d think of pharmaceuticals more as a defensive investment,” he said.
“But you’re looking at companies that have single digit PEs, they have dividends that pay over 3 percent, we’re probably going to get some clarity around the national health care reform—and they’re only up 14 percent for 2009. So for 2010, they’ll be a real treat.”
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No immediate information was available for D’arcy or Kreps.