Both Harris & Trump have 'unattractive' economic policies: Portfolio manager

Advisors Capital Management partner and portfolio manager JoAnne Feeney joins Morning Brief to discuss the political outlook for small caps (^RUT) and some of her top tech plays as the market (^DJI,^GSPC, ^IXIC) gains broaden out beyond the "Magnificent Seven."

Feeney does not expect small caps to be at risk of more fiscal policy changes this year. However, as the election remains tight between Vice President Kamala Harris and former President Donald Trump, she argues that both sides have "pretty unattractive policies." She explains, "It's unlikely that both sides of the aisle would support an increase in the corporate tax rate, no matter who gets elected. So I think that's a low-risk situation. Tariff policy is more concerning, particularly for small businesses, because a lot of the time they're sourcing their inputs from abroad and often from cheap suppliers abroad."

She points to Broadcom (AVGO) as a "core holding" at Advisors Capital Management and a good opportunity for investors, arguing that it has "risen through the ranks through all the acquisitions that their leadership has made over the last several years. But it's still not as well known as, say, a Nvidia (NVDA) or some of the other bigger guys like Microsoft (MSFT) and Amazon (AMZN)." She also highlights its mix of assets, from software to hardware.

"We think it's going to be good for the long term. Other companies like Nvidia may be a little bit more volatile, but also a lot of growth ahead of it. So we like that one as well," Feeney adds.

For more expert insight and the latest market action, click here to watch this full episode of Morning Brief.

This post was written by Melanie Riehl

Video transcript

And Joanne, when you think about the election and something like the potential corporate tax rate uh proposed by the Harris camp, to what extent does that impact your view on small caps moving forward?

That have been sort of rallying as we head towards that rate cut decision on Wednesday?

Do you think small caps are potentially at more risk of fiscal policy changes moving forward this year?

Yeah, I don't think so.

I mean, obviously the election at this point is a coin flip, right?

We don't know who's going to win and both sides have policies that as an economist, I can tell you are pretty unattractive, particularly the tariff proposals that we're hearing the corporate tax rate.

Now it's low now, it's unlikely that both sides of the aisle would support an increase in the corporate tax rate no matter uh gets elected.

So I think that's a low risk uh situation.

Tariff policy is more concerning particularly for small businesses because a lot of the time they're sourcing their inputs from abroad and often from cheap suppliers abroad that are a lot, a lot of them in Southeast Asia.

So that's a bigger concern for small businesses.

And when you think about that moving forward too, I know, for example, uh with your tech picks that you sent over to us, I'm, I'm really interested in the fact that you have Broadcom as one of your tech picks.

Um And obviously I'm not saying that Broadcom is a small cap, but it makes me think about kind of being defensive by not going with the most obvious name in the room, which in this case would be NVIDIA.

Tell me about your choice on Broadcom there and what it tells us about your broader investing thesis, you know, in these kind of opportunities, man, I like to highlight names that perhaps folks are a little bit less familiar with.

Now, Broadcom has risen through the ranks through all the acquisitions that their leadership PAC 10 has made over the last several years.

Um but it's still not as well known as saying NVIDIA or uh some of the other bigger guys like Microsoft and Amazon, we like all of those by the way and, and we think that each of those has a role in different kinds of strategies.

So in our growth strategy, for example, NVIDIA is one of our top holdings, but so is Broadcom and it's a little bit less well known.

We like its mix of, of assets in terms of the software, the hardware, its leading role in some of the optical chip technology that it has had really since its founding uh back in, you know, 2005 when it first went public.

So, you know, it's a core holding for us in almost, I think all of our strategies here at advisors capital.

At first, it, it had a great growth trajectory plus a really high dividend yield, the yield has come down a bit because of how much the stock price has gone up.

So we consider that still to be a core holding.

We think it's going to be good for the long term other companies like NVIDIA, maybe a little bit more volatile but also a lot of growth ahead of it.

So we like that one as well.

All right, Joanne, we're gonna have to leave it there, but really appreciate you joining us on uh all things S and P other than those top seven, except we got a little NVIDIA mention in at the end there, Joanne, thanks so much for joining us.