Markets slide; tech stocks overvalued, invest here instead - SBP Management
(Kitco News) - Equities markets fell on Friday, led by a tumble in technology stocks, but one fund manager maintains his bullish stance.
Michael Danov, president and CIO SBP Management, said that while macroeconomic conditions are favorable for broad equities indices, momentum traders have pushed tech stocks beyond reasonable levels of valuations.
“I don’t think the tech companies should be where they are today, I think it’s unrealistic valuations, what we have, whether it’s the new wave of Robinhood traders that keep it going…I think at some point that has to be realized and it’s trading way [higher] than it should be, and I think some of that investment that’s going there should be diversified for broader markets and broader industries overall,” Danov told Kitco News.
Still, Danov remains constructive on broad equities in the long-term.
“Outside of the tech space, we would see traditional nuts and bolts businesses [do well], that have been overshadowed by the tech companies. I think the resource space, specifically metals and mining, we had a nice run in the last few months as well,” he said, adding that in the long-term, capital will flow away from tech stocks into other indices and the resource sector.