Top Fidelity junk-bond fund manager Mark Notkin is moving away from bonds and into stocks, saying that stocks are offering better values.

Notkin’s fund can hold up to 20% of its assets in stocks, and had 17% in stocks at the end of the third quarter, Bloomberg reports. That’s up from 5% in April 2009. “If I find opportunities, don’t be surprised if it gets to 20%,” Notkin said. “Compared to high yield, equity is very cheap.” He noted that the earnings yield on the S&P 500 was at about 6.9% in the second quarter, which Bloomberg says is the cheapest since at least 1993.

Notkin’s fund returned almost 10% per year for the five years ending Nov. 16, making it #1 out of 422 high-yield funds that Morningstar tracks, Bloomberg reports. Notkin is currently high on industries that will benefit from emerging market growth, like materials and technology. He says he doesn’t think the U.S. economy will be “going gangbusters” anytime soon.

In addition to stocks, Notkin also likes leveraged loans. “When rates rise, which will happen eventually, bank debt will look attractive and will outperform high yield at some point,” he said.