Categories Analysis, U.S. Markets News

How to safeguard your portfolio in a recession-driven bear market

Warnings of a global recession are louder today than ever since the 2008 financial crisis. While these indications aren’t clear-cut evidence of a potential market crash, it’s wise not to ignore the prospects of a recession-induced bear market.

There are still many people out there who have not recovered from last decade’s recession, so it’s quite natural to get a panic attack. However, a recession also holds some amazing buy opportunities, if we are well prepared for it.

stock market thanksgiving day black friday
Photo by Aditya Vyas on Unsplash

Warren Buffett is probably the best example of a recession opportunist. Most of his investments in Bank of America (NYSE: BAC) and Goldman Sachs (NYSE: GS) were made during the 2008 recession period and are currently trading way above the price he purchased them. His philosophy of providing liquidity during the financial crisis turned beneficial to the market as well as himself.

Having some cash reserve at hand is the first step. If a recession hits, prospective stocks may be bought at a cheap price with a long-term growth window.

Having a stake in Buffett’s Berkshire Hathaway (NYSE: BRK.A) (NYSE: BRK.B) is another interesting alternative as more than half of Berkshire’s holding are in recession resilient stocks. Separately, with a massive cash chest of over $122 billion, the company is likely to add to its profitable investments if a recession hits.

READ: Recession panic: Why investors need to stay cautious heading into 2020

If you don’t wish that your money stay idle, you could choose to invest in industries that are unlikely to be affected by a recession.  The auto parts industry could be a great option, as it has historically performed well during such bear markets. The logic is simple – when people don’t have enough cash liquidity, they avoid buying new cars. And the old cars often need constant repairs, which keeps the industry thriving during recessions.

Two stocks that you could consider include AutoZone (NYSE: AZO) and O’Reilly Automotive (NASDAQ: ORLY), both of which have been performing relatively well over the past few years.

Though the pharma segment is not entirely recession-proof, companies with exposure to animal health may be good options. Zoetis (NYSE: ZTS) and Merck (NYSE: MRK) could provide ample cushioning to your portfolio in the event of a market crash.

READ: Major IPOs expected in late-2019 or 2020

It’s not entirely risky if you invest in technology either. The trick is in picking strong companies that have a dominant market share status and strong cash reserves. Look out for companies such as Facebook (NASDAQ: FB) and Alphabet (NASDAQ: GOOGL) (NASDAQ: GOOG) with a strong presence in digital advertising. Historically, even as advertising has suffered during recession periods, digital advertising has fared well and should help these firms stay buoyant.

As we have proved time and again that we are terrible at predicting the market, it’s safe to stay prepared if you wish to take advantage of a bleeding market.

Get access to timely and accurate verbatim transcripts that are published within hours of the event.

Most Popular

FL Earnings: Foot Locker Q1 2024 profit declines on lower sales

Foot Locker, Inc. (NYSE: FL) Wednesday reported a decline in profit for the first three months of fiscal 2024 when revenues decreased 3% year-over-year. Revenues of the specialty athletic retailer

Infographic: How Kohl’s Corporation (KSS) performed in Q1 2024

Kohl’s Corporation (NYSE: KSS) reported first quarter 2024 earnings results today. Net sales decreased 5.3% year-over-year to $3.2 billion. Comparable sales decreased 4.4%. Net loss was $27 million, or $0.24

DG Earnings: All you need to know about Dollar General’s Q1 2024 earnings results

Dollar General Corporation (NYSE: DG) reported its first quarter 2024 earnings results today. Net sales increased 6.1% year-over-year to $9.91 billion. Same-store sales increased 2.4%. Net income decreased over 29% to

Comments

  1. Pingback: HR management
  2. Pingback: fue contact
  3. Pingback: Marketing courses
  4. Pingback: Global Impact
  5. Pingback: Dr. Khaled Azazy
  6. Pingback: tirage horizontal
  7. Pingback: Fiverr Earn
  8. Pingback: fiverrearn.com
  9. Pingback: fiverrearn.com
  10. Pingback: fiverrearn.com
  11. Pingback: fiverrearn.com
  12. Pingback: fiverrearn.com
  13. Pingback: fiverrearn.com
  14. Pingback: frenchie san diego
  15. Pingback: morkie dog
  16. Pingback: bewerto
  17. Pingback: best budget phones
  18. Pingback: future university
  19. Pingback: fue
  20. Pingback: lean six sigma
  21. Pingback: FUE
  22. Pingback: FUE
  23. Pingback: Packing services
  24. Pingback: citi.com/activate
  25. Pingback: Classic Books 500
  26. Pingback: FiverrEarn
  27. Pingback: FiverrEarn
  28. Pingback: FiverrEarn
  29. Pingback: FiverrEarn
  30. Pingback: Coach
  31. Pingback: FiverrEarn
  32. Pingback: FiverrEarn
  33. Pingback: FiverrEarn
  34. Pingback: FiverrEarn
  35. Pingback: partners
  36. Pingback: Betting tips
  37. Pingback: FiverrEarn
  38. Pingback: FiverrEarn
  39. Pingback: live sex cams
  40. Pingback: FiverrEarn
  41. Pingback: FiverrEarn
  42. Pingback: FiverrEarn
  43. Pingback: FiverrEarn
  44. Pingback: FiverrEarn
  45. Pingback: FiverrEarn
  46. Pingback: FiverrEarn
  47. Pingback: wix seo specialist
  48. Pingback: web design
  49. Pingback: Slot Gacor
  50. Pingback: Kuliah Termurah
  51. Pingback: cheap sex cams
  52. Pingback: fullersears.com
  53. Pingback: fullersears.com
  54. Pingback: dehydrated water
  55. Pingback: rare breed-trigger
  56. Pingback: 늑대닷컴
  57. Pingback: Slot Asia
  58. Pingback: nangs sydney
  59. Pingback: allgame
  60. Pingback: 918kiss
  61. Pingback: หวย24
  62. Pingback: Acne treatment
  63. Pingback: pg slot
  64. Pingback: AI Lawyer
  65. Pingback: carte uno reverse
  66. Pingback: cybersécurité
  67. Pingback: Raahe Guide
  68. Pingback: Raahe Guide
  69. Pingback: resort lake placid
  70. Pingback: health supplements
  71. Pingback: 38/40 ammo
  72. Pingback: 300 win mag ammo
  73. Pingback: itsMasum.Com
  74. Pingback: itsMasum.Com
  75. Pingback: more
  76. Pingback: itsmasum.com
  77. Pingback: itsmasum.com
  78. Pingback: joker gaming
  79. Pingback: lahore jobs

Comments are closed.

Add Comment
Loading...
Cancel
Viewing Highlight
Loading...
Highlight
Close
Top