Petrilli posiada 30 letnie doswiadczenie w dziedzinie rynków kapitalowych oraz tworzeniu globalnych rozwiazaniach finansowych. Zajmowal najwyzsza stanowiska w Citibank, Morgan Stanley, State Street, Pershing, a takze Donaldson, Lufkin & Jenrette.
Recently, Paszport do Wall Street regular Tony Petrilli sat down to discuss what's in store for the U.S. markets for a turbulent 2016-and a Presidential election year. "I think 2016 will be very volatile. We're going into a period here where the market is sort of forcing itself up through multiple expansions, and I don't believe it is sustainable," said Petrilli. "I expect to end the year either flat to down 10%."
In a volatile market, where growth is largely unsupported by fundamentals-individual stocks can move dramatically, losing or gaining huge percentages in just one day. These movements are generally unpredictable.
Petrilli currently sees a market environment where buying is thin, and any disappointment results in large downward moves overnight. Global growth is scares, and multiples are stretched versus near term fundamentals. Volatility can create opportunities, but it also paralyzes traders and investors.
"In a market like this, you need to manage risk," said Petrilli. "You've got to size your portfolio correctly. You cannot go for a single stock and put all your money there as stocks can be revalued down by 20% or more overnight. This is why I encourage investors to use ETFs and limit individual stocks to no more than 20% of your portfolio."
In balancing your portfolio, it is important to gauge how volatile a single instrument can be. As a general rule, broad based ETFs have the least volatility, followed by Sector ETFs, Industry ETFs, and with individual stocks having the most volatility. So, if your risk tolerance to a single day loss is 1% loss, then it is best to hold broad based index ETF such as the SPDR S&P 500 Trust ETF: SPY. If you make the premise that one sector, for example financials
Buying ETFs doesn't mean you should just sit and hold your position. In 2016, if you'd like to see gains, you need to take advantage of volatility, and you need to use technical analysis to try to find levels of support and resistance. But without risking your whole portfolio.
Historically the market is stronger when Republicans control government, as the P/E multiple tends to expand. But the current front runners have strong views that can upset a number of industries which is why partially this market is having trouble finding some legs," said Petrilli.
But not to fear: a balanced portfolio that is open to risk, but not subsumed by it, will help the wise investor steer through the uncertain waters of 2016.
Meet Petrilli and ask him your own U.S. market questions during his talk at Konferencja WallStreet20. See event details and tell us you're attending at this link!
