With the Tel Aviv 25 Index hitting its all-time high today, "Globes" asked leading market players for their predictions about where the market is headed, and what investors ought to do.
"Globes": What do you think about the present level of prices?
Clal Finance VP investments Tamir Porat: "In the wake of the market rally, prices aren’t cheap, but movement forward will continue to be positive. When looking at multiples, the average multiple on the Tel Aviv 100 Index indicates that the market isn't cheap, but neither is it divorced from reality. It isn't a bubble either. So long as we see continued improvement by Tel Aviv 100 companies, the trend will continue to be positive."
What should investors do?
"The TASE will become more challenging for investors, partly because of the lack of alternatives in the bond market because of the prevailing low interest rates. Usually, there is a correction after a strong market rally, so when looking forward, investors should look less at indices and more at companies.
Where will the TASE be at the end of 2010?
"Positive returns of 10-15%."
Tamir Fishman Investment House CEO Eldad Tamir:
What do you think of the present level of prices?
"If you take a cold look at the world's markets, there is no doubt that the stock market has undergone a very high mathematical change from its low point. But the current level of multiples is not very high, so there is no shortage of opportunities to be found. Until now we have been seeing a market correction from the crisis when we expected catastrophes. But from now on things are very different."
What should investors do?
"I am not one of those who believe that you can time it to enter or exit the market as it rises and falls. Even if the market is high one must maintain the same percentage exposure. Unequivocally, I do not say that now is the time to pursue a strategy of realizing profits. The strategy should be to keep a portfolio with the same level of risk over the long term. In general Us markets are more attractive and have a relatively high potential because we have not seen extremely high rises there and a lot of money is sitting on the fence.
Where will the TASE be at the end of 2010?
"Positive returns."
Migdal Investment Portfolio Management chief investment manager Shmil Kurtzman:
What do you think of the present level of prices?
"Although low interest supports continued entry of money into the market, and the Us continues to push the whole world forward, but I think we have already reached reasonable prices, and the major shares on the Tel Aviv 25 are relatively high and have already reached full pricing. There I no meat left on these shares for significant rises but only crawling slowly forward.
What should investors do?
Those whose exposure to the market is more than 30% of their portfolio should reduce it a little. I would also recommend transferring some of the portfolio to the Tel Aviv 75 Index because the pricing there is not full."
Where will the TASE be at the end of 2010?
"Between 1,300-1,350 points."
Published by Globes [online], Israel business news - www.globes-online.com - on April 6, 2010
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