ETF.com: What's your longer-term outlook for U.S. stocks?
Belski: We think we're six years into a 15- to 20-year bull market. We've been saying that for five years. At some point, we're going to see a big correction; we don't think that big correction has happened yet. Ultimately, there's going to be a lot more volatility surrounding the Fed, because the Fed hasn't moved yet. We're still worried about the reliance on monetary policy.
ETF.com: A 15- to 20-year bull run would be quite impressive. Is there precedent for that?
Belski: The run from 1982 to 2000 was 18 years. There were other bull markets that long between the late '40s and early '60s, so there’s a precedent to it.
By the way, this bull market is something that could actually be longer because people are doubting it. This is the biggest stealth bull market of my collective career. Nobody believes it.
Remember, bonds have been in a 33-year-long bull market. You're going to have a pretty deep unwind of the bond market; that could just elongate the equity bull market.
ETF.com: Are there particular sectors of the market you favor over others?
Belski: We're overweight financials, industrials and technology. On a near-term basis, consumer discretionary and health care can do really well. At some time in the near future, we're going to have more of an early-cycle rally, but for now, we're officially overweight financials, industrials and technology.
Editor's note: ETFs related to Belski's views are the SPDR S&P 500 ETF (SPY | A-99), the Financial Sector SPDR (XLF | A-90), the Industrial Sector SPDR (XLI | A-92) and the Technology Select SPDR (XLK | A-91).
Contact Sumit Roy at [email protected].