Ho, Ho, No! Santa Claus Rally Won’t Hit Wall Street This Year Says Wirtz


Time is running out and hope is fading fast that this market still has a Santa Claus rally somewhere up its sleeve.

"I was in such a good mood a week ago," says Keith Wirtz, chief investment officer of Fifth Third Asset Management. "Five days ago I felt like we would have the infamous Christmas rally." Now, he sees signs that institutions are cashing out with two weeks of trading to go.

Despite decent economic news, investor behavior appears to have changed, especially amongst the active managers and hedge funds that share his institutional orbit.

"It's too frustrating," Wirtz says in the attached video clip. "75 to 80% of active managers have underperformed this year...I think they've just thrown in the towel." Too much money has moved to the sidelines to change Wirtz's mind.

Unfortunately, Wirtz has little confidence in Congress as well. In fact, he not only sees ''policy risk'' continuing and being partially to blame for the volatility that has plagued markets this year, but characterizes it as one of the most difficult risks for a money manager to get a hold of.

Aside from scrounging up a 2012 calendar, Wirtz is winding down this year with a barbell strategy of defensive and cyclical large cap ideas and offers up Tiffany (TIF) and Bristol-Myers (BMY) as a complimentary pair that fits that bill.

Beyond that, his battle cry for the short term is "lean on stocks, lean on domestic stocks, and lean on quality."

Are you still a believer or packing it in until 2012?

If you haven't already, feel free to reach out to me on Twitter, @MattNesto or visit us on Facebook.

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