Many investors are growing bullish about the global economy, with falling market prices in the United States (US) and continuing sovereign debt issues in Europe creating opportunities.
Dave Marvin, of US firm Marvin & Palmer associates, said he was “extremely bullish” due to changing market conditions.
Speaking at yesterday’s Association of Superannuation Funds of Australia (ASFA) luncheon, Marvin said the continuing sovereign debt crisis across both Europe and the US has forced people to become more prudent.
“Change never occurs because people wake up one morning and say: ‘We should be a little more prudent’. They change when they are forced to change,” he said.
Marvin said his bullish tendencies could also be put down to the lack of investors putting their money in the stock market.
“People are out of stocks. They’re cheap, but they don’t own them … people are underinvested around the world,” he said.
JANA Investment Advisers executive director and head of consulting in Sydney, John Coombe, agreed that US investors had been hurt by stock markets and were still keeping away.
“People are in their 50s and they are saying: ‘I want to save, and I want to save in the most conservative way I can’,” Coombe said.
He said that until three months ago, those people were staying in cash and bond markets, while there were net outflows from stock markets.
“Investors have given up. That’s a great opportunity to invest if you’re counter-cyclical, because you are buying cheap,” he said.
