Coronavirus investing tips, stock strategy from BlackRock CIO DeSpirito – Business Insider

  • Tony DeSpirito of BlackRock told Business Insider about the blend of safety and risk he’s targeting after an unprecedented bout of volatility and economic uncertainty.
  • With the economy possibly frozen in place for months, and amid the threat that similar measures will be imposed again, he’s looking for companies that can outlast their peers.
  • DeSpirito is the chief of BlackRock’s fundamental-active-equity business and the manager of a $35 billion fund.
  • Visit Business Insider’s homepage for more stories.

In an unprecedented crisis, Tony DeSpirito of BlackRock is working on a road map.

DeSpirito is the chief investment officer of fundamental active equity for the largest asset manager, which oversees $4.7 trillion. He also manages its $35 billion equity dividend fund.

In an exclusive interview, he told Business Insider how he’s thinking about the meltdown spurred by the coronavirus pandemic.

The core of DeSpirito’s approach is finding companies that are highly profitable, which means they steadily earn more than their cost of capital. After the February and March sell-off, he’s applying that focus to companies that have abruptly become undervalued.

“Stocks that have done the worst, which are the value stocks, will do the best,” he said. “The only times when we’ve been at spreads this wide (between the most expensive and least expensive stocks) … over the last hundred years that are similar are the global financial crisis and the Great Depression.”

Also at a historic level is the yield gap between dividend-paying stocks and
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