Jeremy Grantham, chairman of institutional money manager GMO, says it's too early for investors to re-enter the equities market.
"After all this pain … the U.S. equity market is not even cheap," Grantham told Barron's.
"You would imagine that, given the amount of panic, that it would be," he said.
"Prior to three months ago, we were investing in emerging-market equities. Then we battened down the hatches, and I changed my view from avoid all risk except emerging markets to avoid all risk, period," Grantham says.
Though Grantham says his current portfolio is "as conservative as it can possibly get," he adds that he's long on high-quality, blue chip stocks, particularly in the United States, and short on risky companies.
"Going forward, you can think about slowly moving back into the cheapest pockets of global equities," Grantham says.
"The next move that we make will be back to moderate neutral in emerging-market equities and small-cap international value," he adds.
"I can't say we are going to be in a great hurry, but that will be our next move. It's hard to imagine this crisis subsiding because stock prices are digging in their heels and approaching fair value," Grantham says.
Marc Faber, Swiss fund manager and publisher of the Gloom Boom & Doom Report, agrees with Grantham's assessment.
"We had an unprecedented global economic boom. A global bust is likely to happen," told Business Mirror.
Instead of stocks, Faber advises buying gold in physical form and storing it outside the United States.
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