“It’s not easy to find opportunities today,” says Howard Marks, the co-founder of Oaktree Capital Management, the world’s largest investor in distressed assets. Stocks and bonds have risen to the point where they represent fair value compared with near-zero yields on short-term government bonds, yet promise very low absolute returns, he tells CNBC. But out-of-favour assets may still offer some value.
There is a “real dichotomy between the things that are obviously successful but expensive and the things that look low-priced but are challenged in terms of business”. The first group includes technology stocks and other companies that have benefited from Covid-19, such as home delivery, while the second includes real estate – especially retail and offices in big cities – as well as entertainment, hospitality and tourism (such as cruises). “Big money will be made by buying the latter” in situations where the business still works.
Subscribe to MoneyWeek
Subscribe to MoneyWeek today and get your first six magazine issues absolutely FREE
Sign up to Money Morning
Don't miss the latest investment and personal finances news, market analysis, plus money-saving tips with our free twice-daily newsletter
Don't miss the latest investment and personal finances news, market analysis, plus money-saving tips with our free twice-daily newsletter
-
8 of the best riverside properties for saleThe best riverside properties for sale – from a Grade II-listed former mill house with views over the River Chelmer in Essex, to a townhouse on a Georgian terrace overlooking the Avon Gorge in Clifton, Bristol
-
Will “Liberation Day” strike again?Donald Trump’s 90-day tariff pause comes to an end on 9 July. Can we expect further market turmoil?
-
Is Donald Trump putting the US dollar in danger?Donald Trump's administration sees one of its greatest advantages – the US dollar – as a burden. Gold is the obvious beneficiary, says Cris Sholto Heaton.
-
The British railway industry is in rude health – here's why investors should jump aboardThe railway industry has bounced back from the devastating impact of the pandemic and is entering a new phase of development – and profitability
-
AGMs: a unique selling point for investment trusts that investors should capitalise onOpinion Shareholder meetings aren’t just a regulatory requirement – they are a way to communicate with investors
-
A cyclical case for UK stocksOpinion Depressed margins and relatively low valuations mean the UK market could rally strongly as conditions improve, says Cris Sholto Heaton.
-
Infrastructure investing: a haven of stable growth amid market turmoilFrom booming construction in emerging markets to digital and green transitions, the infrastructure sector offers security, returns and long-term opportunities
-
The costly myth of “sell in May”Opinion May 2025's strong returns for US stocks have once again shown that putting too much weight on seasonal patterns will only make investors poorer, says Max King
-
Who’s driving Tesla?As Elon Musk steps back from government with his eyes on the stars, investors ask if he’s still behind the wheel at his electric-car maker.
-
Investment opportunities in the world of Coca-ColaThere is far more to Coca-Cola than just one giant firm. The companies that bottle and distribute the ubiquitous soft drink are promising investments in their own right.
