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00:00Megan how scared stiff are people in this great bull market. I think they're a bit more concerned with what they're seeing in the economy but when it come from an investment standpoint. You still have a lot of people that are looking at the equity markets. When you look at from a relative basis the equity markets are the most attractive place to be right now especially versus bond buying yields where they are. We've seen a back up in yields but they're nowhere near where they should be. Given the current economic environment and inflation environment when you look at what you do every day are you finding within your strategy that you're going to rebalance end of this great bull market or do you let your winners run. Right now you have to be careful if you've let some of those winners run well over which your your allocation should be. And we're looking into the end of this year to take a look at some of our big winners see if we need to rebalance primarily because of the fact that we do see a lot of risks over the coming months in the equity markets. And it comes from some of the things that everyone continues to talk about what will happen with margins that we see rising pricing pressures and we see labour market shortages. These are things that you want to be a bit careful about. So we'll be looking to make sure that we're not too overweight in where we should be considering what our Alix Steel make a what's the ultimate call option so to speak to say that story to say I'll wake up and fit and optimistic that supply side interest rates are going to ease through next year. Where do you want to be present in the equity market. So with a supply chain made the economy is still on a very solid footing. So we still would look at some of those cyclical areas. We'd be very cautious around those expensive growth type of sectors. We can say those are the ones that will be impacted by higher interest rates and that is something that we think will occur. So you want to be in cyclicals you want to look at financials you want to look at materials you look at industrials in the areas of the market and then also small NIKKEI stocks as well. All right. So in your view Megan has a 60 40 portfolio officially died. Yes. This is not the type of situation where we are. We are coming off a 40 plus year bond the bull market. And right now we're looking at interest rates. That should be a lot higher from here. Most likely will move higher from here. So with duration as high as it is in the fixed income market you have to be very cautious around fixed income the private market market the alternatives. This is another place to diversify your portfolio. So we'd be very cautious around that. It's a 40. It's not going to give you that same benefit. And the most important thing is not going to do that risk reward that you that we have typically been making. Can you describe a tech stock that you would like. I know you can't do the single names with. It's just describe the business model you'd want exposure to. I honestly I wouldn't buy High Flyers right now at ISE. So and we from us. Yeah. A little too expensive for me right now. That's the easiest way of answering. I just don't like him. John thank you. So.

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Verdence's Horneman Cautions Investors About Looming Risks

Megan Horneman, Verdence Capital Advisors director of portfolio strategy, cautions investors to be careful because of the economic risks on the horizon for equities. She speaks on "Bloomberg Surveillance."

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