Latest news with #JohnDavi
CNBC
04-07-2025
- Business
- CNBC
Re-risking your portfolio: Investor John Davi's picks for the second half of 2025
John Davi, founder and CEO of investment management company Astoria Portfolio Advisors, has one overriding piece of advice for investors heading into the second half of the year: "Re-risk your portfolio." The stock market has made a sharp turnaround from its early April lows, when fears over tariffs and their effect on inflation and the econony were at their highest. The S & P 500 was down 15% year-to-date on April 8, but is now up roughly 6.7% for the year as investors have regained confidence in the outlook for the economy , strong corporate profits and AI technology. But investors lately continue to seek out resilient pockets of the market due to uncertain trade policies and geopolitical tensions, however. Like many investors, Davi — whose firm manages $2.5 billion in total assets, including four ETFs — has gotten more constructive on U.S. stocks compared to the beginning of 2025. The recent run-up, particularly in the broader market outside tech, has given him greater conviction in companies beyond classic growth stocks. "Now we're at a point where earnings revision breadth has had this V-shape recovery. We have a weaker dollar. We've got policy uncertainty that's declined ... less tariffs. We have renewed optimism over AI," Davi told CNBC. In the past, a declining dollar "has been a tailwind for risk assets, globally ... rather than keep buying the 'Mag 7' stocks, there's so many other opportunities out there." "It's time to re-risk your portfolio," Davi said, at a time when markets are likely to rally further over the coming six months. ETFs to navigate the rest of 2025 Buying exchange-traded funds tied to the broader market are a generally safe bet for long-term investors seeking passive gains. But Davi's advice is to look beyond popular ETFs such as SPDR S & P 500 ETF and Vanguard S & P 500 ETF and look instead at opportunities in industrials, energy, real estate and fixed income. Davi named several ETFs that are strong picks heading into the latter half of the year, noting they're tax-efficient with low fees and a "safer and more conducive" means of accumulating wealth for individual investors. Equal-weighted ETFs are among his favorite during periods of high concentration, as they can offer strong returns and more diversification, particularly when smaller companies outperform. As an example, Davi spotlighted the Invesco S & P 500 Eql Wght Industrials ETF (RSPN) as a better way to gain exposure to industrials than the popular Industrial Select Sector SPDR Fund (XLI) . "There's all this risk still out there, right. But really, if you strip out the 'Mag 7,' the S & P 500 is not that expensive," he said. An equal-weighted ETF that's not skewed to the largest stocks today takes advantage of stocks outside technology, or mid-sized and smaller companies, "that are growing faster earnings than these tech stocks." One of Davi's top picks is the BNY Mellon Global Infrastructure Income ETF (BKGI) , which has jumped 30% in 2025 and 41% over the past year, against S & P 500 returns of nearly 7% and 15% over the same periods, according to FactSet. The fund's last 12 months' distribution yield is 4.17%, its net expense ratio is 0.55% and the average price-to-earnings ratio of its portfolio is 16.2 times trailing earnings, FactSet data shows. The ETF's top holdings are concentrated in utilities and energy, with Enel SpA , Hess Midstream , Orange SA and Dominion Energy among its top 10 holdings as of March 31. PPI SPY 1Y mountain Astoria Real Assets ETF (PPI) vs. SPDR S & P 500 ETF (SPY) over the past year. Astoria Real Assets ETF (PPI) offers similar opportunities, Davi said. The fund has also outperformed, rallying 14% so far in 2025. With a net expense ratio of 0.78% and a trailing, 12-month yield of 1.36%, the fund' top holdings include SPDR Gold MiniShares Trust , Rolls-Royce Holdings , Simon Property Group , Shell and Constellation Energy . Industrial and utility stocks have raced ahead this year, gaining more than 13% and 8%, respectively, as investments have ooured into AI-related projects such as data center infrastructure and equipment. In fixed income, Davi pointed to the Schwab High Yield Bond ETF (SCYB) , JPMorgan BetaBuilders USD High Yield Corp Bd ETF (BBHY) , Janus Henderson AAA CLO ETF (JAAA) and the SPDR Portfolio Intermediate Term Corporate Bd ETF (SPIB) as attractive. "Owning credit makes a lot of sense. There's value in holding high yield credit and corporate credit," he said.
Yahoo
20-06-2025
- Business
- Yahoo
Wall Street's First-Half Whiplash Rewards All-Weather Portfolios
(Bloomberg) -- Somehow, for all its drama — tariffs, fiscal brinkmanship, inflation fears, and geopolitical flare-ups — the first half of 2025 may be remembered by diversified investors for something else entirely: the strongest stretch of synchronized market gains in years. Security Concerns Hit Some of the World's 'Most Livable Cities' One Architect's Quest to Save Mumbai's Heritage From Disappearing JFK AirTrain Cuts Fares 50% This Summer to Lure Riders Off Roads NYC Congestion Toll Cuts Manhattan Gridlock by 25%, RPA Reports Taser-Maker Axon Triggers a NIMBY Backlash in its Hometown Rather than spelling a slow-motion disaster for bulls, months of whiplash across equities, fixed income and commodities have rewarded strategic indifference and punished overconfidence. Strategies that spread risk across assets are outperforming by near-historic margins, a shift from the concentrated bets that favored the likes of Big Tech stocks in recent years. A Societe Generale multi-asset portfolio, tracking equities, government bonds, corporate credit, commodities and cash, is on pace for its strongest first-half performance since at least 2008. Even the classic 60/40 stock-bond mix — written off during the pandemic-era disruption as obsolete in a world of uncertain inflation — has proved relatively resilient. Meanwhile, a popular multi-asset strategy known as risk parity is up about 6%, by one measure. This holiday-shortened week offered fresh validation for cautious investors. Federal Reserve Chair Jerome Powell warned of 'elevated uncertainty' around economic growth and said new tariffs could reignite supply-side price pressure. Disappointing economic data and ongoing clashes between Israel and Iran added to the case for investors to stay vigilant about both the business and market cycle. In a market this divided, perhaps the only reasonable stance is to refuse to take a side, favoring instead a principled neutrality in portfolios built for all-weather conditions. 'For every indicator out there that shows the economy is strong, I can give you one that shows it's slowing,' said John Davi, chief executive of Astoria Portfolio Advisors. 'Uncertainty is definitely higher.' In a year when international stocks, gold, and even Bitcoin have outpaced the S&P 500, investors are being rewarded for looking beyond the familiar. Davi's firm's multi-asset ETF, with gold as its top holding, is up more than 10% — a result, he said, of building a portfolio 'meant to survive uncertainty, not predict it.' Trading in the biggest asset classes this week reflected the stunted returns that — despite the April rebound — have made a virtue of going further afield at a time of economic and political anxiety. The S&P 500 ended lower on the week and sits just 1.5% above where it began in January. Ten-year Treasury yields are broadly flat this week, while a broader index of government bonds has returned 3% so far this year. Instead, diversified portfolios have been powered by assets long eschewed during the era of Magnificent-7 exceptionalism. Developed-market equities excluding the US and Canada have climbed 14% year-to-date, while the Bloomberg Commodity Index has surged 8% this year, while gold has soared nearly 30%. 'I find that when it comes to owning things outside the US, from the US investor point of view, there's a lot of reluctance,' said SocGen's Manish Kabra. 'The only time you are really diversified is when you have assets that you don't want to own.' US investors are starting to get the message. Based on inflows, the top dozen ETFs tracked by Bloomberg over the past month encompass a broadening palette of asset classes, including gold, Bitcoin, overseas equities and short-term T-bills, alongside US stocks and bonds. 'ETFs are a natural solution to find diversification through other forms of equity exposure or yield hunting in the fixed income space, particularly to strategies with limited duration risk,' said Todd Sohn of Strategas. 'Ultra-short duration strategies have taken in the second-most inflows of categories we track.' To be sure, the old-school asset classes remain the main destination for investor cash. Equity ETFs have pulled in roughly $56 billion so far in June, surpassing May and April totals, with still around one week. Total cross-asset flows now stand at $523 billion, which means ETFs are on track to take in more than $1 trillion this year, after topping that number for the first time in 2024. How those bets fare in the evolving macroeconomic climate remains to be seen. A string of weaker-than-estimated data releases has pushed Citigroup's US Economic Surprise Index to its lowest level since September. On Wednesday, Fed officials downgraded their estimates for growth this year while lifting forecasts for unemployment and inflation. 'The macro backdrop has shifted so quickly this year,' said Ayako Yoshioka, senior portfolio manager at Wealth Enhancement Group, a $100 billion registered investment adviser. 'Concentration helps in a bull market. Diversification helps you keep what you've earned when the macro backdrop shifts frequently.' Luxury Counterfeiters Keep Outsmarting the Makers of $10,000 Handbags Ken Griffin on Trump, Harvard and Why Novice Investors Won't Beat the Pros Is Mark Cuban the Loudmouth Billionaire that Democrats Need for 2028? The US Has More Copper Than China But No Way to Refine All of It Can 'MAMUWT' Be to Musk What 'TACO' Is to Trump? ©2025 Bloomberg L.P. Sign in to access your portfolio
CNBC
21-05-2025
- Business
- CNBC
Stock returns start to evaporate when yields rise to where they are now
Bonds could slow down the stock market after a stellar bounce over the past six weeks. The 30-year Treasury bond yield spiked back above 5% on Wednesday, while the benchmark 10-year Treasury note yield was more than 4.5%. Rates have been pushing higher lately as investors worry about the U.S. fiscal deficit. Moody's on Friday downgraded the country's debt, the last of the major credit rating agencies to do so. This week, Republicans are trying to pass a budget bill that could worsen the U.S. deficit. Those moves come as stocks have staged a rip-roaring rally off the post "liberation day" lows. Since hitting an intraday low on April 7, the S & P 500 is up more than 22%. However, the benchmark historically has not done well when yields are this high. Raymond James last week looked at S & P 500 average annualized returns when the 10-year Treasury yield trades above various key levels. The data shows that, since 2021, the benchmark proxy for the U.S. stock market averages just a 1% annual advance when the 10-year trades above 4.5%. With a 10-year rate above 4.6%, the benchmark loses 2.4% per year on average. Losses get much worse when the yield tops 4.7% — with the S & P 500 plunging at an annual rate of 35.5% on average. "We believe the long-term implications of an unchecked deficit are profound," wrote John Davi, CIO of Astoria Portfolio Advisors in a note out this week. "While difficult to model in a mark-to-market daily/monthly performance framework that we live in, allocations to gold, real assets, precious metals and alternative assets appear increasingly sensible." Gold prices climbed 0.6% while equity futures slid Wednesday. Contracts tied to the S & P 500 and Nasdaq-100 indexes lost 0.7% each, while Dow Jones Industrial Average futures shed 368 points, or 0.9%. Elsewhere Wednesday on Wall Street, HSBC downgraded UnitedHealth to reduce from hold, calling for more than 16% downside ahead. ″[The] new CEO has opportunity to start on a clean(er) slate, but we see risk to earnings growth along with policy overhang," analyst Sidharth Sahoo wrote on Wednesday. UNH shares were down more than 6% following the rating change.
