Buy large caps as bull market persists: Fisher

March 19, 2008 - PRLog -- By Natsuko Waki

World stocks, as measured by MSCI .MIWD00000PUS, have fallen more than 12 percent from a record in November as concerns have grown that the U.S. economy might fall into recession.

However, Chairman and Chief Executive Kenneth Fisher, who manages assets of $45 billion, believes the U.S. economy is not falling into recession. He added firms with large capitalization have fared better than smaller companies since late last year, which showed a typical final phase of a bull market.

"We are still in a bull market. We just have a correction within the bull market and this typically lasts a few months. There tend to be scary stories which a year later would look foolish," Fisher told Reuters.

"There is zero evidence in history that we (have ever) had a recession shortly after the bull market peak, within three months of the peak in global markets."

Fisher said smaller firms tend to outperform big-cap stocks in the first two phases of a bull market.

"We have shifted from small-cap leadership to big-cap leadership. The bigger the stock, the better it does. This process accelerated in the back end of last year," he said.

"Investors should buy the biggest and stupidest stocks."

Website: www.fi.com