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Asset Managemement Firm Still Sees Opprtunity in Stock Market, Calls for Increase in Equity Exposure
RALEIGH, N.C. -- Despite the stock market's sharp decline, BB&T Asset Management, LLC, today said it is advising its clients to increase the equity allocation in their capital appreciation portfolios.
"We firmly believe that the current market environment, far from posing daunting risks, is becoming increasingly constructive for investing in equities," said David McMahon, BB&T Asset Management chief investment officer.
"Considering the current economic uncertainty, the expectation that earnings reports may continue to be lackluster, and the ongoing volatility of the stock market, many investors may feel that they should continue to reduce their equity exposure. However, we believe that it is not too early to increase equity allocations.
"The last 12 months have been a good reminder of the importance of portfolio diversification. "We expect investors who focus on securities with good earnings potential and reasonable valuation characteristics will earn attractive returns on their diversified portfolios in the year ahead."
McMahon cited three reasons for his recommendation: investors have overreacted to falling prices; volatility creates opportunity; and the time is right for rebalancing investment portfolios.
Raleigh-based BB&T Asset Management, a registered investment adviser, manages customized investment portfolios for affluent individuals, businesses and institutional investors.
"We are not market timers," said McMahon, "but there are times when discreet revisions in an asset allocation are prudent in order to manage risk or take advantage of future opportunities."