the sky is falling!!
So this Nov drop has been somewhat baffling. Different sectors have gone, up, down, and sideways; but mainly down. I think I found a bit of a "safe haven" in names like KO, MO, MCD, and even PG. Yup, looks like a classic flight to safety in a nervous market. Look at their charts relative to the Dow for the last 6 months. (Don't be fooled by the March drop in MO, they spun off the Kraft shares). And it just so happens these are large US exporters. In particular, I like MO at this point as the classic recession-proof, defensive stock.
posted by Junk Bonds @ 12/15/2007 12:17:00 AM
2 Comments:
Smokes and alcohol consumption go up during a recession don't they? All the names you mentioned have strong brands and are definitely defensive. Utilities are the other classic defensive stocks.
This is great!
It seems that the turbulence in the markets may continue for a few weeks or even months (in case of a recession for example).
These stocks look really good. In particular I like KO. MCD was pumped up by a couple of good news recently, which may not necessarily continue in future. The growth of KO however seems more stable and less event driven.
In fact if the volatility of the markets continue, the price of these safe stocks may go up.
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