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Sometimes the best offense is a good defense.
So says, Stephen Bodurtha, Citi Private Bank Head of Investments for North America on CNBC’s Fast Money.Despite record low yields on the 10-year, Bodurtha tells us that he still thinks one of the best defensive plays available to investors is long US Treasurys. “I think both intermediate and longer term bonds have more upside,” he says.
“A year ago, we were telling people to buy bonds when the 10-year was yielding 3%. That turned out to be a good move. We still think that’s the best place to be – in fixed income. And we think intermediate and long-term bonds have more upside,” he says. “It’s a good place to be.”Also he suggests establishing long position in utilities and telecom stocks.Bodurtha's thesis is simple: he believes that weakening economic growth overseas as well as a diminished appetite for risk after the financial crisis, will quickly send investors into risk-off mode.“We’ve got a challenged situation. The developing world is weakening a lot, that’s a key focus,” he says. “And risk appetite has dialed down. That’s why we like defensive plays – in both bonds and selective areas of the stock market.”
* Citi Private Bank works with one-third of the world’s billionaires overseeing $250 billion in assets under management.
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