Fund manager explains how to make money in a volatile stock market
Pella Funds Management’s Jordan Cvetanovski identifies the best companies to invest in unpredicted times. Some of them did well during global financial crises like Covid. Speaking to CNBC Pro Talks last week, he noted that global headwinds are roiling the stock market — and some sectors are set to benefit. Cvetanovski is chief investment officer and portfolio manger at Pella. Stock exchanges belong to this group. He said that he owns companies such as CME & Deutsche Borse, and a small company called Flow Traders based in the Netherlands, which are ETF and ETP market makers. He said that volume rises in uncertain times because more people trade and spreads increase. These firms profit from the spread, the difference between selling and purchasing prices. Cvetanovski stated that “Lehman and Covid” were the best of their quarters. This refers to 2008’s market crash and subsequent coronavirus pandemic. He suggested that investors should consider investing their money in dividend-paying companies to help them protect their assets. He said that Flow traders’ stock prices rose by around 22% during the global stock market plunge in February 2020. The stock gained approximately 75% between the Covid crash’s onset and early July. Cvetanovski stated that supply chain problems are another uncertainty. This includes those that have been caused by Russia’s ongoing war with Ukraine. He said that Nutrien, the Canadian fertilizer manufacturer Nutrien, could do well in this environment as there is likely to remain a tight potash market for some time. It’s a great time to be a company such as Nutrien, with comparatively low margin costs of $60 and a price point of $800. Cvetanovski stated that “a lot of thought and diversifying risk is key” in uncertain times. You can predict earnings by placing a few wagers where you believe you can. According to Cvetanovski, he had sold property and banks before mortgage defaults rose in the wake of the global financial crisis. He then exited the market after reports about China building field hospitals surfaced at the beginning of the Covid pandemic. Cvetanovski also stated that Pella Funds Management currently doesn’t own any banks stocks. Cvetanovski said that we don’t own any banks, since you could buy banks at higher interest rates. Because the economy is strong, generally interest rates rise. “We don’t currently have this,” he stated. He said that interest rates have risen because of inflation, and not due to good economic performance. “For [banks]It’s not an attractive proposition so banks aren’t on our radar right now,” he stated, noting that the bank is not on his radar, but adding that he will be cautious, especially considering the amount of debt involved in certain countries like Australia and the Netherlands.
Jordan Cvetanovski from Pella Funds management names some companies you can own in uncertain economic times.