Stocks peeling back just a tad as fall begins, but as far as sentiment is concerned, most strategists are still quite bullish. In fact the latest AAII poll has the bulls at nearly 45%, down some from last week but well above the long-term average of 39.0%.
Some investors and others on the street are a bit more sanguine, given time the feeling is that something out there will dampen the mood for stocks. Tobias Carlisle, author of the new book Deep Value, is a bit concerned at these levels, but there are some bright spots.
“It’s not the fields of clover from Q1 2009,” he says in the attached video, but that there are “little pockets” of opportunity to buy, such as otherwise strong companies have struggled a bit with their businesses.
Despite valuation concerns, it’s hard for Carlisle to say sell stocks now. “The market is very expensive on a number of long-term, cyclically adjusted type metrics, but the problem is that they’re just not predictive, you can’t use it and say ‘this means that you sell now.’ Anytime that you do that you invariably underperform the buy and hold investor.”
Carlisle is looking for individual stocks at this stage of the bull market, opportunistically looking for moments to buy dips when when volatility spikes. “I wish there was a little bit more volatility out there because it benefits guys like me who are going to buy very deeply undervalued stocks,” he says.
On the flipside, if volatility does spike up, Carlisle advises the best thing for investors to do is to hold onto stocks through higher volatility because investors typically get hurt when they sell at the bottom.
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