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A $4 billion fund manager who's crushing his peers shares one of his favorite sectors to ride into the inevitable downturn

Like many peers who made big bets on large technology companies, White is crushing it in 2017.

Justin White started his career "at a consulting firm you've never heard of."

But after joining the asset-management giant T. Rowe Price, and showing a strong track record as a media and tech analyst, he was tapped last April to run its New America Growth Fund.

His fund, with $4 billion in assets under management, gained 25% this year through Thursday. That's stronger than the Lipper Multi-Cap Growth Funds Average it's compared to, and the broader Russell 1000 index he describes as an "imperfect" benchmark.

Stock pickers like White are seeing a turnaround in their fortunes this year. Since the recession, more money has gone to passive strategies and products like exchange-traded funds (ETFs) that are designed to mimic the returns of an existing index.

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"The real test for active management is going to be the next bear market," White told Business Insider.

"We should see all the stocks that went up for reasons that didn't make sense get obliterated as people sell. And active managers — if they're as good as they're supposed to be — should be able to sidestep that more elegantly than ETFs or passive strategies can."

To ride into the inevitable downturn, and for cyclical exposure that would hold up in most market environments, one of White's preferred sectors is financials.

But that's been a "frustrating" bet this year, he said. It's not what many fund managers believed just after the 2016 election, when they expected higher interest rates and deregulation to help banks.

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"The number one reason why financials have not done what people hoped they would do is because the 10-year Treasury yield has just remained anchored so low," White said. This has limited the earnings banks make from their net interest margins, or the gap between the interest rates at which they lend and borrow, relative to their assets.

"I'm overweight financials, but I wouldn't call it a very high-conviction positioning right now," White said. "

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