Title: Investing $10,000 in the Current Climate: Medical Devices, Software, and Classic Cars

Where to Invest $10,000 Right Now

Four financial experts identify promising avenues amidst a complex market landscape characterized by record-breaking highs and persistent underlying tension. To stay updated on future installments of this series, which typically releases monthly, readers can subscribe to the accompanying email notification.

As the S&P 500 climbs toward unprecedented levels, investor anxiety is simultaneously intensifying. Market optimists cite strong earnings growth fueled by artificial intelligence, steady corporate profitability, and anticipated productivity boosts. Conversely, skeptics argue that the current rally is narrowly supported by a few mega-cap technology firms, with valuations for key AI-related companies appearing inflated. Compounding these concerns is the unpredictability of the US-Iran conflict and the potential for rising inflation to further strain consumers whose financial stability is already eroding.

Despite these headwinds, the S&P 500 and the Nasdaq 100 have surged 20% and 33.6%, respectively, following the market downturn in late March. This momentum has reignited fears of retail investor "FOMO" (fear of missing out). A prime example is the Roundhill Memory ETF (DRAM), which has attracted over $9 billion in net inflows and gained approximately 151% since launching on April 2. Meanwhile, segments of the US Treasury bond market have reacted nervously to the risk that elevated energy costs could fuel inflation, potentially leading to higher interest rates.

Bloomberg consulted four experts to suggest compelling investment opportunities during this volatile period. Their recommendations span both defensive and growth-oriented strategies, including hedging an expensive equity market with energy shares, investing in European defense firms, targeting the "Mag 7" tech giants, focusing on medical technology, and exploring the undervalued software sector.

When asked how they would personally allocate a $10,000 windfall outside of traditional investments, the experts offered varied suggestions: hiring a personal trainer or purchasing a vintage early-2000s Mercedes-Benz CLK Cabriolet. For investors preferring exchange-traded funds, Bloomberg Intelligence ETF research associate Andre Yapp provides guidance on using ETFs to mimic these expert strategies.

Russ Koesterich, Portfolio Manager, BlackRock Global Allocation Fund Strategy: Hedge with Energy Stocks

The Concept: Investors have largely moved past the Iran war and the resulting spike in energy prices, with stock markets recovering their losses and then some. However, geopolitical risks remain. With equities at all-time highs, it is prudent to consider hedging these gains. The most logical choice? Increasing exposure to energy stocks.

The Approach: To understand the efficacy of this strategy, it is useful to examine why traditional hedges are underperforming. Bonds and gold are struggling. Since the conflict began, real 10-year Treasury yields (based on the TIPS market) have increased by roughly 0.30%, and bonds with maturities exceeding 10 years have fallen by about 5%. Gold, despite a recent bounce, has performed even worse. Furthermore, both assets are increasingly correlating with stock movements, diminishing their value as portfolio diversifiers.

In contrast, energy stocks have demonstrated greater resilience. They have risen nominally since the war’s onset, offering valuable diversification. Additionally, earnings momentum is expected to persist, supported by the likelihood that oil prices will remain elevated for an extended period.

The Outlook: If the conflict does not resolve quickly, energy stocks are positioned to be one of the few assets that can effectively diversify a portfolio.

Sarah Ketterer, CEO, Causeway Capital Management Strategy: Invest in Medical Technology

The Concept: US medical technology stocks, which once commanded high valuations, are now trading at significantly more reasonable levels. The S&P 500 Health Care Equipment Index is currently priced at a 10-year low relative to its two-year forward earnings estimates. This represents a sharp decline from a peak price-to-earnings ratio of 30 times earnings in 2021 to just 16 times earnings last month. Many medical device manufacturers are currently...

Source: Bloomberg Generated at: 2026-06-03 11:00:07 UTC