Investor pessimism? Hop on stocks, says Kenneth Fisher

Billionaire investor says now is the time to get into the market; commodity producers particularly attractive
AUG 18, 2010
Rising levels of investor pessimism are a reason to buy equities now, billionaire Kenneth Fisher says. The chief executive officer of Fisher Investments Inc. favors commodity producers after the Standard & Poor's 500 Index dropped 5.1 percent over the last two weeks, according to an interview on Bloomberg Radio. An American Association of Individual Investors report showed yesterday that expectations U.S. equities will fall over the next six months rose 12.4 percentage points to a one-month high of 42.5 percent. “I'm never going to be bearish when people are pessimistic,” Fisher, who oversees $35 billion from Woodside, California, said in an interview on “Bloomberg Surveillance” with Tom Keene. “My bias when pessimism is high is to own equities.” A group of 32 raw-materials companies is one of two industries among 10 that have gained this week as the overall S&P 500 lost about 1 percent. The group rose 0.5 percent, helped by Melbourne-based BHP Billiton Ltd.'s bid $39 billion bid for Potash Corp. of Saskatchewan Inc. Profits for metals companies, chemical suppliers and seed- makers in the S&P 500 are forecast to rise 67 percent in 2010, the second-most of any industry behind banks, according to estimates from more than 2,000 analysts compiled by Bloomberg. Analysts predict profit growth of 26.4 percent next year, also the second highest rate for any industry. “We're still in this period where redeployment of capital at the business level is very strong, which means we'll increase utilization of materials very heavily,” Fisher said. The S&P 500 has declined this week as signs the economic rebound is stalling overshadowed better-than-estimated earnings growth. U.S. stocks fell today, with the S&P 500 heading for a second weekly decline, after a drop in commodities dragged energy and metal producers lower and as concerns continued that the economic rebound may be flagging.

Latest News

Investment accounts fund nearly 7% of US household spending, JPMorgan finds
Investment accounts fund nearly 7% of US household spending, JPMorgan finds

A new JPMorganChase Institute report reveals how deeply stock market wealth now drives everyday American spending, especially for retirees.

New white paper challenges advisors to rethink solo aging planning
New white paper challenges advisors to rethink solo aging planning

A survey of 507 solo agers finds most lack confidence in their plans and that systems, not just individuals, need to change.

Most Americans need $5,094 a month to retire - and most won't get there
Most Americans need $5,094 a month to retire - and most won't get there

A new Schroders survey exposes a widening gap between what Americans expect in retirement and what they're actually on track to receive.

Advisors get the keys: AdvisorCRM and Zeplyn let firms build their own AI tools
Advisors get the keys: AdvisorCRM and Zeplyn let firms build their own AI tools

Two wealthtech providers are handing advisors the controls, letting firms design their own workflows and AI agents in plain language.

Former San Francisco advisor gets nine-years for running Ponzi
Former San Francisco advisor gets nine-years for running Ponzi

Edwin Lickiss earlier admitted that he defrauded at least 93 victims of over $9.5 million from 1998 through 2024.

SPONSORED Direct indexing webinar targets tax-loss harvesting amid market swings

Northern Trust’s Ken Lassner shows advisors how to convert volatility into after-tax portfolio gains

SPONSORED Who builds the income when the pension disappears?

Dan Biagini of American Equity says the steady decline of pensions, longer lifespans and a reset in interest rates are rewriting how advisors build retirement income