Money manager Yana Barton expects Big Tech and health care to dominate market gains for the next 12 months and beyond.
Despite a recent Wall Street rotation into economically sensitive groups, Barton wants to stick with what's working.
"All the secular tailwinds that were with us in 2020 are only accelerating," Eaton Vance's growth equity co-director and portfolio manager told CNBC's "Trading Nation" on Wednesday.
She believes a secular bull market in tech and health care is in its early stages — fueled by the coronavirus fallout. Barton cites the work-from-home movement and corporate investments in IT, cloud computing and security as well as advancements in medicine.
"We're in a world where we've just been shown technology [and] science's brilliant minds were able to create a vaccine after sequencing the virus in less than a year," said Barton, who has $30 billion in assets under management. "Imagine what we can do with other therapies to cure things like cancer and other chronic diseases."
She prefers investing in large companies with solid growth management and strong cash flows rather than jumping into rallying cyclical stocks such as small caps. The Russell 2000, which tracks the group, just completed its best quarter on record.
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"We talk about GARP quite a bit, and that's growth at a reasonable price," said Barton. "Whether you're a growth investor or a value investor, I think you're seeking mispriced opportunities in the market."
In health care's case, Barton sees it as a hybrid sector offering growth.
"It's trading at a 20-plus percent discount to the market, and there are some sub sectors like biopharma and biotechnology in particular that [are] trading at a 30% discount with really solid fundamentals," she said.
The S&P 500 health-care sector's gains over the last 12 months are more muted, up about 13%. But over the past year, the tech-heavy Nasdaq has soared 40% while the broader S&P 500 is up 15%.
