As investors move toward the late innings of the economic cycle, it’s worth considering a handful of sector ETFs.

Money managers are increasingly growing nervous over an upcoming recession amid higher interest rates and tighter credit availability, CNBC reports.

“It’s a classical late cycle story. So, when I was here last time, I said we were long and nervous. We are no longer long, we are increasingly nervous about this,” Roelof Salomons, chief strategist at Kempen Capital Management, told CNBC.

Salomons pointed out that the evidence for a late cycle is all there, icnluding a flatter yield curve, which usually predicts an upcoming recession where the yield curve inverts; credit spreads are widening, suggesting that investors are afraid of risks; and defensive stocks are outperforming.

“It is too early for the economy to rollover but for markets it is time to get back home,” Salomons added, suggesting that as investors are taking fewer risks and showing a preference for U.S. stocks.

Late-Cycle Sectors

Laurent Godin, senior equity analyst at Indosuez Wealth Management, argued that investors whom believe we are heading toward the end of the bull market should play it out with overweight sector exposures to technology, financials and energy.

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