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Portfolio Managers' Stock Picks: Large and Small Caps

Since the March bottom, small caps have outperformed large caps, but in the last month, larger firms have come on stronger.

So where should you put your money? Portfolio managers Mary Jane Matts of Fifth Third Large Cap Value Fund and Bob Sullivan of Satuit Capital Microcap Fund shared their insights. (See their stock picks, below.)

“Make sure you don’t underinvest in small or microcap stocks coming out of a recession and into this next expansionary economy,” Sullivan told CNBC.

Sullivan said valuation in small-cap stocks is still attractive and they have decent exposure to foreign sales.

Counterpoint: Dollar Pressure

In the meantime, Matts said the downward trend in the U.S. dollar favors large caps.

“The major determinant of the small versus large is going to be the domestic versus international GDP growth picture,” she said. “The point where we are right now, it is true that in the Eurozone, expectations are lower than where they are in the U.S., that would generally favor the small."

"But if you look at the developing economies, the opposite is true—you still have that major tailwind for large multi-national companies that sell into those developing economies,” she said.

Matts Likes:

Amgen

Chevron

Sullivan Likes:

Shuffle Master

FBR Capital Markets

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Disclosures:

Sullivan owns shares of SHFL and FBCM through his fund SATMX.

Matts owns shares of AMGN and CVX through her fund FEINX.

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Disclaimer