“Right now the U.S. is in a deep recession. None of us know for sure when it will end, and the short-term indicators are inconclusive. Yet there is one thing I’ve learned from years of investing: The stock market is not just a big monolith. It’s a complex machine with lots of moving parts — and they don’t all move together,” Ron Rowland writes.
“Of course, figuring out which part of the market will move in which direction at any given time isn’t so easy. However, three market sectors tend to do better in a weak economy. You’ll sometimes hear them called the “defensive” sectors. Today I’ll tell you what they are and name some ways you can play them with ETFs. As you’ll see, I like “global” sector funds that divide up the world based on economic sectors instead of countries or regions. I think this global approach usually gives you the best exposure to any given sector,” Rowland Reports.
He goes into detail on 3 defensive sectors with examples on each in the article. We have listed some below:
Defensive Sector #1: Consumer Staples
If you want to stick to large-cap domestic stocks, the Consumer Staples Select Sector SPDR (XLP) is a very popular choice.
Defensive Sector #2: Utilities
A good way to zero in on this sector is with the iShares S&P Global Utilities (JXI), which has 38 percent of its assets in U.S. companies, 12 percent in Germany, 10 percent in France, and 9 percent in Japan.
Defensive Sector #3: Health Care
The iShares S&P Global Health Care (IXJ) is my favorite way to get exposure to the worldwide health care sector. IXJ has about 63 percent of its portfolio in the U.S., 13 percent in Switzerland, and 10 percent in the United Kingdom.
Full Story: HERE