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Big Money poll: Is fixed-income a contrarian buy?

  • It's no surprise fixed income is a hated asset class, but how much so? Just 4% of respondent's in Barron's Big Money poll of money managers are bullish on the sector, with 85% bearish. By contrast, 79% have a positive view of equities vs. 7% negative.
  • Not surprising given negative feelings about the bond market, the utility sector garners the most votes (32%) for being the worst expected performer over the next year. Taking first place for the sector expected to perform best is - what else - tech.
  • WIth 91% of managers in agreement, Sears (SHLD) tops the list of most-hated stocks. Next at 87% is Tesla (TSLA). After that with 80% Is Herbalife (HLF), followed closely by ZIllow (Z) and Netflix (NFLX).
  • Apple (AAPL) and Berkshire Hathaway (BRK.A, BRK.B) top the list of most-loved stocks with 70%, followed by Citibank (C) at 60%.
  • Broad fixed-income ETFs: AGG, BND, LAG, SCHZ, BOND, SAGG, MINC.
  • Broad equity exposure ETFs: IYY, VTI, EXT, TOTS, EUSA, ITOT.
  • Utility ETFs: IDU, PUI, XLU, VPU, RYU, FXU, PSCU, UPW, SDP, UTLT.
Comments (14)
  • Stone Fox Capital
    , contributor
    Comments (6177) | Send Message
     
    of the most hated stocks, SHLD is the only one to not have soared. It is going to be a massive short squeeze!
    20 Oct 2013, 09:44 PM Reply Like
  • Walter P. Chrysler
    , contributor
    Comments (300) | Send Message
     
    it is ironic since the two markets have been feeding off one another for some time now. The Fed tried to restore "balance" this summer...which obviously crushed gold and the commodity complex. Equities barely budged only to soar. Treasuries have since rallied again so i can't say i understand why the word "hated" would be used. clearly there is no inflation and little in the way of recovery to celebrate. defaults have proceeded apace ironically enough. no one wants rain on the parade of course...but i think a breather for any great bull market...and this is a great bull market...is never a bad thing if the goal is to try and get to higher highs. the alternative of course is a crash and i don't think anyone wants that. I do find it interesting that the Fed hasn't said anything though.
    20 Oct 2013, 09:54 PM Reply Like
  • hat_trick3
    , contributor
    Comments (893) | Send Message
     
    SHLD is hated because the amount of work necessary to understand it is beyond the attention span of these money managers- most of whom are concerned more about their vanity and mentions than actually doing homework.
    Any analyst who is willing to put the time in researching Sears will reach the same conclusion that Berkowitz and a few other "contrarians" have reached.
    Second, one fact rarely mentioned is that Berkowitz and Lampert own just over 80% of the entire float. Beyond that a few other investment groups have SHLD as their top holding, with one fund having over a quarter of their investors money in the name.
    You just don't see that kind of conviction very often, if ever.
    It wasn't long ago, there was near consensus that Amazon was overvalued, or that HP would be out of business by 2014. I also remember Ford was supposed to disappear as was AOL and many others.
    20 Oct 2013, 10:02 PM Reply Like
  • MSF INVESTMENTS
    , contributor
    Comments (4255) | Send Message
     
    Berkowitz and Baker Street have already done a thorough research so I am sure the managers looked and went over it. The doubt lies in the value of the real estate where the bears have done their research and say it is not worth what the bulls say.

     

    It appears unless their is oil beneath those properties, the hidden value and plans have been exposed and still no massive squeeze and if anything short interest is still expensive and rising.

     

    Long Puts
    21 Oct 2013, 07:01 AM Reply Like
  • hat_trick3
    , contributor
    Comments (893) | Send Message
     
    There is much more beyond the asset play. For example, ESL knows he doesn't need a 200,000 square foot store to sell high margin Lands end and KCD. The KCD portfolio can be sold anywhere. In fact it can be argued that KCD will grow much faster if shoppers don't need to travel to a dreaded Sears, be it Lowes, HD or Autozone.
    Another way to look at is ask yourself does Stanley Black& Decker own storefront. They do quite well letting others do the selling.
    Similarly, any redevelopment efforts can include a "Land's end" store of appropriate size (think Gap)
    Many of the real estate bears also fail to realize that many of the redevelopment efforts will go into mixed use. This is a huge miss on their part.
    Lastly, with only 19% of the shares remaining in float. ESL Berkowitz and another hedge fund take SHLD out any time and wipe out the shorts. the total capital needed could probably be raised in a week.
    21 Oct 2013, 08:30 AM Reply Like
  • scott trader
    , contributor
    Comments (4842) | Send Message
     
    Zillow looks decent after recent pullback .. I'd rather own jcp than sears......long aapl and disney
    20 Oct 2013, 10:07 PM Reply Like
  • Sakelaris
    , contributor
    Comments (1410) | Send Message
     
    Why is Netflix rated among the most-hated by the money managers? Is it because they missed buying it for themselves and their clients in 2012 when they could have picked it up for less than $60 a share? Do I sense sour grapes?
    20 Oct 2013, 10:44 PM Reply Like
  • rope789
    , contributor
    Comments (133) | Send Message
     
    No, fixed income is not a contrarian buy, unless your goal is to have very low or negative returns.

     

    The only way bonds do well from here is if rates go down and stay down, and while the COULD happen, there are many factors that cut against that happening over the next few years.

     

    The contrarian play was to sell or short fixed income about a year ago, with the 10 year at 1.75%, as billions of retail dollars poured into fixed income mutual funds.

     

    That is making the peak in equities in early 2000 look like child's play, because the total capital invested in debt is so much larger than the money invested in equities.
    20 Oct 2013, 10:45 PM Reply Like
  • buyandhold???
    , contributor
    Comments (907) | Send Message
     
    do they hate tsla bc they missed the run up and are getting burned on their shorts?

     

    just wait till it smokes earnings next week, the vins in existence already show theyre going to blow out the 5k car guidance
    20 Oct 2013, 11:44 PM Reply Like
  • PoorProgrammer
    , contributor
    Comments (5) | Send Message
     
    hey buyandhold???. Like some of your stock picks. But could you stop yelling about rumours as the golden truth?

     

    Last time you talked of HIMX chips being in Apple's new iPhone which is totally wrong to anyone who has had even a casual interest in Apple. Apple fabricates it's own A-line (A6,A7..) chips.

     

    Again, appreciate the point of view. But tune down the yelling.
    21 Oct 2013, 12:45 AM Reply Like
  • Michael Bryant
    , contributor
    Comments (5584) | Send Message
     
    Hm, so does this prove why dividend stocks outperformed non-dividend stocks during the last interest rate run up. Does anyone study history. Theory is great, but it is still theory. History gives the facts.

     

    (BRK.B) is always loved.

     

    Be greedy when others are fearful. In other words, buy when others are selling.
    21 Oct 2013, 12:25 AM Reply Like
  • GizmoA51
    , contributor
    Comments (116) | Send Message
     
    If you own at least a little bit of everything you can be both a genius and eat your sour grapes at the same time.
    21 Oct 2013, 12:00 PM Reply Like
  • surferbroadband
    , contributor
    Comments (1714) | Send Message
     
    SHLD ready for a short squeeze? Maybe. I went to Sears last week and got a set of new tires for my truck. It was the cheapest tires I could buy anywhere. I dropped $298 for a set of 225 70R 15. Balanced, and mounted. Now if they are able to keep me as a customer, then they will still be in business. When I look for good deals on merchandise, Wal-mart, Sams Club, 99cent store are on my list, but Sears never was. Because of the set of tires I had to get my mind is changing about Sears.

     

    Money mangers hate Sears? Money mangers were wrong about TSLA. They are also wrong about SHLD.

     

    I like what Michael Bryant just said, "Be greedy when others are fearful. In other words, buy when others are selling."
    21 Oct 2013, 12:28 PM Reply Like
  • rube123
    , contributor
    Comments (1291) | Send Message
     
    did you buy them at Racine
    if you would have waited to the 25th, you would have got a better deal
    there are plenty more deals coming, Kmart has a liquidation on the 27th
    as many stores that are shutting down, should be able to catch a sale every day right thru the end of the year

     

    http://bit.ly/1eGAlmj

     

    "Be greedy when others are fearful" is a Buffett quote
    Buffett also said he only buys businesses that he/directors understand

     

    Do you understand SHLD, does anybody
    if so, please tell everybody, and be sure to tell Eli

     

    1 rumor after another, so far the only result is a lot on money has disappeared
    were are the $$ from the royalties
    the investments have returned a negative ($70) billion

     

    http://bit.ly/1eGAlmk

     

    http://huff.to/1eGAlml

     

    Long BRK.B
    22 Oct 2013, 11:58 AM Reply Like
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