Investors should favor U.S. equities over European or emerging-market shares, according to Sharmin Mossavar-Rahmani, chief investment officer for Goldman Sachs Group Inc.’s private wealth-management unit.
She said she’s bullish on bank shares because they are cheap even after the industry in the Standard & Poor’s 500 Index rallied 8.1 percent this year. The group has a price-earnings ratio of 11, compared with 15.3 for the U.S. equity benchmark, according to data compiled by Bloomberg.
“U.S. equities, in the long-run, are the place where clients should have their core assets, relative to Europe or emerging markets,” Mossavar-Rahmani said in an interview with Bloomberg Television.
Mossavar-Rahmani recommended investors underweight government bonds and predicted inflation will remain low. Investors shouldn’t expect stocks to return as much as they have in the past few years, she said. The S&P 500 is up 129 percent since March 9, 2009.