SECOND TEAM François Trahan Wolfe Trahan & Co.
François Trahan of Wolfe Trahan & Co. slips to second place after three years atop the roster; he also is ranked third in Quantitative Research. “He’s better than just about anyone else in terms of taking all the macroeconomic variables — all these continuous streams of data on employment, interest rates and diffusion indexes — and linking up the whole cacophony with what’s most likely to happen in the financial markets,” avers one booster. Trahan principally urged caution over the past year. His chief concerns have been that the Federal Reserve Board’s second round of quantitative easing would result in a “tax on consumers” in the form of higher gasoline, clothing and food prices when the unemployment rate was hovering above 9 percent and that “they simply couldn’t afford it.” In this environment, he says, “you want to move toward quality, dividends and other things that generally make people yawn but nonetheless offer alpha.” In mid-February he recommended that investors phase out holdings in cyclical stocks and opt for defensive sectors: specifically, consumer staples, health care and utilities. By the end of August, those sectors had outperformed the broad market by 13.4, 10.6 and 15.1 percentage points, respectively.