Tom Forester, one of the few fund managers to make it through the recent market crash almost unscathed, tells CNBC that he expects a year-end rally in the market, and says bargain stock values have him “excited” about the future.
Forester, who heads the Forester Value Fund, has locked in a loss of only about 4 percent this year while the broader market is down about 40 percent, according to CNBC. “We stayed out of financials, we went long into safer areas like consumer staples and health care, and we’ve really been able to ride out this market unscathed,” he said. Forester adds that he and his team saw the housing crisis coming by looking at metrics like home price/income and home price/rent ratios, which were reflecting “complete bubbles” in recent years.
Looking ahead, Forester says he foresees a year-end rally, and notes that he is picking up more volatile stocks. “With valuations where they are … we’re pretty excited about the future,” he says. “Over a five-year period or so we think that you’ll see some very good returns.”
Forester mentions a handful of current favorites: Microsoft (MSFT), Pfizer (PFE), US Bancorp (USB), and ConocoPhillips (COP). (For some more picks and commentary from Forester, see Fortune’s 2009 preview.)