From AI to Emerging Markets: How Six Pros Would Allocate $10,000 Now
With markets at record highs, six Wall Street strategists reveal where they would invest $10,000 today. Their picks cover a wide range—from artificial intelligence to emerging markets. These experts highlight opportunities in U.S. and global equities, small-cap stocks, and dividend payers, offering diverse strategies for investors.
JPMorgan Prefers International Stocks Over U.S.
Gabriela Santos, J.P. Morgan Asset Management’s Chief Market Strategist for the Americas, suggests putting $7,000 into developed international markets and $3,000 into emerging markets. She points out that U.S. stocks currently trade at about a 35% premium compared to international peers, well above the historical average of 15%.
“After years of underperformance, international equities have surged this year, and this trend looks set to continue,” Santos says. Factors like a weaker U.S. dollar and rising global investor interest support this shift. She highlights the Vanguard FTSE Developed Markets ETF (VEA) and iShares MSCI Emerging Markets ETF (EEM), which have returned 19.7% and 18.6%, respectively, as of last week.
Stifel’s Bannister Advocates Diversified Equity Exposure
Barry Bannister, Chief Equity Strategist at Stifel Financial, advises against concentrating investments in tech stocks despite their recent dominance. Instead, he recommends splitting $10,000 equally across small-cap, international, and value stocks to reduce sector risk.
“The market is too fixated on tech right now, but it’s risky to rely on just seven stocks,” Bannister notes. His preferred ETFs for diversification include the Vanguard Value ETF (VTV), iShares Russell 2000 ETF (IWM), and iShares MSCI ACWI ex U.S. ETF (ACWX). He recently applied this strategy himself after receiving new capital in May.
Equal Weighting for Balance, According to Haverford Trust
Hank Smith, Chief Investment Officer at Haverford Trust, proposes a balanced approach: allocate 50%–60% to an equal-weighted S&P 500 ETF like the Invesco S&P 500 Equal Weight ETF (RSP) and 40%–50% to a cap-weighted index such as the Nasdaq 100.
This method reduces heavy exposure to the largest tech firms while still allowing participation in tech-driven rallies through Nasdaq holdings. Smith recommends a minimum investment horizon of five years for this strategy to pay off.
Piper Sandler Focuses on U.S. Large-Cap Leaders
Michael Kantrowitz, Chief Investment Officer at Piper Sandler, suggests active stock selection over passive sector ETFs due to elevated interest rates and uneven corporate earnings. He expects U.S. large-cap leaders to keep outperforming.
Kantrowitz warns that passive ETFs can misrepresent performance because of how stocks are weighted. He favors companies currently standing out in their models, including:
- Nvidia Corp. (NASDAQ: NVDA)
- Microsoft Corp. (NASDAQ: MSFT)
- Alphabet Inc. (NASDAQ: GOOG, GOOGL)
- Meta Platforms Inc. (NASDAQ: META)
- Oracle Corp. (NYSE: ORCL)
- Costco Wholesale Corp. (NASDAQ: COST)
- Johnson & Johnson (NYSE: JNJ)
- Home Depot Inc. (NYSE: HD)
BlackRock Strategist Advocates Diversification Beyond Big Tech
Tony DeSpirito, BlackRock’s Global CIO of Fundamental Equities, advises investors not to abandon Big Tech but to diversify holdings. He sees value in combining large-cap growth, dividend stocks, and value plays to balance volatility.
DeSpirito points to dividend-paying stocks for their resilience and steady income. He also highlights healthcare, specifically medical device makers, as an undervalued “quality value” sector. However, he cautions that some large pharma companies might be value traps due to earnings reliant on expiring patents.
Janus Henderson Sees Potential in Tech, Europe, and Mid-Caps
Lara Castleton, U.S. Head of Portfolio Construction and Strategy at Janus Henderson, recommends a diversified portfolio for investors with longer time horizons and higher risk tolerance. Her suggested allocation is:
- 60% in large-cap U.S. equities with a tech focus, via funds like the Invesco QQQ Trust (QQQ) or Technology Select Sector SPDR Fund (XLK)
- 20% in international stocks, especially European equities showing improving fundamentals
- 20% in U.S. mid-caps, benefiting from reshoring trends and offering higher upside potential than large caps
Castleton emphasizes the growth prospects in these segments as well as the benefits of geographic and market-cap diversification.
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