The 2016 investment year didn’t start on a good note thanks to China’s stock meltdown the first two days of the New Year. China is still having issues with their manufacturing base, and it appears those issues will continue in 2016. The Chinese government stopped stock trading twice the first 10 days of 2016, and that may be just the beginning, according to Highland Capital Management CEO Jim Dondero.
Jim Dondero is known for his ability to assess and predict market trends. That’s why Highland Capital Management has been so successful over the years. Dondero and partner Mark Okada started the company in 1993, and they have built a team of competent investors that weigh all the options and opportunities before any investments are made.
A recent Forbes article went into detail about the roller coaster ride the stock market put investors through in 2015. The article mentioned the fact that the price of oil still has many investors worried. Some investors are so worried that they are pulling out of the stock market, according to Forbes. But seasoned investors like Dondero know where to invest when the market acts like it did in 2015. Jim Dondero invested millions at the end of 2015 in healthcare, energy and technology stocks.
Some of Dondero’s investments were new, and others were additional shares of stocks Highland Capital already owned. Dondero thinks investors should stay with the proven growth stocks in 2016. Those stocks may not gain as much as some of the riskier stocks, but they won’t lose much value either.
The Forbes.com article brought up the fact that the market is in a favorable position right now. The article reiterated what Dondero believes when the reporter wrote, “When investors swing the risk pendulum to the “worry” side, there is a possibility of excellent gains coming from a countermove swing. No one knows for sure what will happen in the stock market in 2016, but the investors that play it safe and don’t invest in stocks that are performing poorly like retail stocks should have a decent year in the stock market.