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Big money pros predict the next big trade

Rick Newman
Senior Columnist

A recurring theme at this year’s SALT conference, the annual gathering of hedge-fund honchos in Las Vegas: Invest in Europe.

“Europe has been a long stretch of either disaster or disappointment,” Troy Gayeski of Skybridge Capital, which runs the SALT conference, tells Yahoo Finance in the video above. “You’ve finally got attractive growth, better inflation data, reasonable valuations and much better earnings prospects.” This comes, of course, after centrist Emmanuel Macron won the presidency in France, dispatching the radical Marine Le Pen and easing fears of a populist revolt.

Europe is also looking more stable than the United States these days, an abrupt turnaround from the last several years, when the US economy led the world out of recession while Europe grappled with debt bombs in Greece and other countries, fragile banks and and the United Kingdom’s withdrawal from the European Union.

Troy Gayeski, senior portfolio manager at SkyBridge Capital

Investors pulled billions of dollars out of Europe during recent years, and while money is beginning to trickle back, there’s still room for an inflow of capital to help push stocks higher. “Our point isn’t that Europe’s great, you’re gonna make a lot of money,” Gayeski says. “But if there ever was a time for Europe to outperform the United States, it’s probably the next 6 to 12 months.”

There aren’t many ordinary investors at the SALT conference, but you don’t need sophisticated trading strategies to invest in Europe. There are plenty of mutual funds and exchange-traded funds that represent broad baskets of European equities, as well as specific sectors such as tech or finance. And investing pros generally recommend a gradual transfer of funds, rather than all-at-once bets—so if there’s any updraft left in the US market, you might catch part of that, too.

Read more: A rolling update from the SALT conference

Rick Newman is the author of four books, including Rebounders: How Winners Pivot from Setback to Success. Follow him on Twitter: @rickjnewman.