Top Tips to Prep Your Portfolio for 2022

Brendan McDermid | Reuters
  • Top strategists see plenty of upside for investors in the year ahead, particularly in cyclical stocks and health-care technology.
  • "There is so much to be excited about," says Hightower's Stephanie Link.

Investors saw it all in 2021. Next year promises a little more upside, according to two top strategists.

"Aside from the latest variant, and Covid in general, the underlying economy is quite strong," Stephanie Link, chief investment strategist and portfolio manager at Hightower, said during CNBC's Financial Advisor Summit Wednesday.

"You have above-trend inflation, not runaway inflation," she told CNBC's Bob Pisani. And, "we are eventually going to fix the supply chain."

That is good news for consumers and the economy overall, Link said.

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Although stocks took a dive last week on concerns over a faster-than-expected taper of the Federal Reserve's bond buying program, unwinding those emergency stimulus efforts will lead to "normalization," noted Liz Young, SoFi's head of investment strategy. 

"People need to look at that as a buying signal."

Going forward, owning cyclical stocks will produce major advantages, Link also said, including "energy, materials and industries with pricing power."

After this past year, "a lot of portfolio managers are overweight in tech, although there are opportunities there," she added.

"I do like cyber security and [artificial intelligence] and [augmented reality] — there is so much to be excited about."

And, "anything related to health-care technology," Young added.

Markets have already bounced back from last week's selloff, with technology stocks leading the way. The Nasdaq is up 4% since Monday. The Dow Jones Industrial Average and S&P 500 Index notched their largest two-day gain since November 2020.

Link said she expects 11% to 12% earnings growth in 2022. Young said she anticipates growth to be as high as 15%.  

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