An extra risk for the active stock-picking manager was the correlation effect, he said, noting that as ETF managers bought and sold en masse to reflect index moves, "a stock picker or sector picker is wiped out like a tsunami."
Inflation And Trump
While acknowledging "inflation is back," Lamotte saw gold as an adequate hedge at present given his view that annual price increases in the West were unlikely to exceed two percent a year.
"Also to fight inflation, equity is a good hedge," he said.
Lamotte currently holds 42 percent of his portfolio in equities, with fixed income and gold accounting for 36 percent and 10 percent respectively. However he owns no government bonds at all, preferring to be "overweight" in U.S. investment grade and European high-yield corporate debt instead.
Lamotte remains unfazed also by the shock U.S. presidential election win for Donald Trump, whose views on taxation, immigration and trade have unnerved many. Emerging stocks have fallen more than 7 percent since election day while U.S. 10-year bond yields have jumped about 40 basis points.
"I was not surprised. We ... bought a lot of cement companies in the United States because whatever happens, they will do infrastructure," Lamotte said.
He predicted Trump would struggle to carry out threats to impose punitive trade tariffs with many emerging markets, adding: "If he cut all trade ties with China, U.S. women would have no lingerie ... they don't make it in the U.S. any more!"
One market which has been pummeled especially hard after the election is Mexico, which could suffer from the president-elect's threats of immigration and trade curbs. The peso has slid about 12 percent from Nov. 8 to record lows.
"The Mexican peso is probably a buy at this level," Lamotte said.