Money managers under the microscope
Majedie warns of “hammering” for cyclicals
Another sign this year’s huge equity market rally may soon run out of steam.
After Crispin Odey’s warning last month of a pullback — yet to emerge but certainly a possibility according to many hedge fund managers — Majedie Asset Management’s Matthew Smith has sold out of cyclical stocks in case economic growth disappoints.
“If you’re buying cyclicals now you have to take much more of a view on earnings 12 to 24 months out,” he told me.
“If the economic doesn’t recover in line with what everyone expects, some cyclical stocks could be absolutely hammered… Now’s not a good time to put on a lot of risk.”