Why a Junk-Bond Investor Favors Stocks

摘要

Fidelity Investments' Mark Notkin, whose high-yield mutual fund beat all rivals over the past five years, says the long runup in junk bonds is over and stocks are now a better buy. The manager of the $12.8 billion Fidelity Capital & Income Fund is putting more money into equities and into the secondary market for loans made by banks to risky corporate borrowers. And he's cutting back on high-yield junk bonds, which have soared 80 percent since the start of 2009. "I don't see the value in the high-yield market," Notkin says. "You are not being paid to take risk." In April 2009, Notkin had 5 percent of his fund's assets in stocks, regulatory filings show. The figure was 17 percent in September of this year, according to Fidelity's website. "If I find opportunities, don't be surprised if it gets to 20 percent," says the manager.