BofA’s Subramanian Echoes Yogi Berra’s Advice of Avoiding Crowds

She says leave the S&P 500 index and buy small caps, energy
Bank’s contrarian indicator nearest to buy signal since 2017

Savita Subramanian, BofA Securities head of equity and quantitative strategy, says investors should pursue small-cap stocks over the equities within the “crowded” S&P 500 index. If everybody is in the S&P 500 and they’re all selling at the same time, the S&P isn’t really that safe,” she says on “Bloomberg The Open.”Source: Bloomberg

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By John McCorry and Jonathan Ferro

January 4, 2023 at 6:55 PM UTC

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Yogi Berra once said of a restaurant that “no one goes there anymore. It’s too crowded.” Bank of America Corp. strategist Savita Subramanian has a similar warning for stock investors.

“Everybody is using muscle memory to go back into what they think of as the safest equity market, which is the S&P 500,” the firm’s head of US equity and quantitative strategy told Bloomberg Television’s The Open on Wednesday. “The trouble is if everybody is in the S&P 500 and selling at the same time, the S&P isn’t really that safe. The S&P 500 is the most crowded ticker in the world and it’s time to go into other benchmarks, like small caps.”